TheMeatSite.com - TheMeatSite.com - news, features and articles for the meat processing industry

News

Strength of Sterling Key to Imports Rise

13 May 2015
QMS - Quality Meat Scotland

UK - The strength of Sterling has been one of the most significant factors affecting the price of finished cattle in recent months, according to Quality Meat Scotland.

The currency situation, which has seen a 10 per cent – 15 per cent increase in the value of Sterling, has meant that it has been difficult for processors to export, said Stuart Ashworth, Head of Economics with QMS (pictured).

At the same time the market has become more attractive for imports.

“Provisional customs data for January and February highlight this challenge by showing exports of UK beef have reduced by around 2500 tonnes (13 per cent) while imports have increased by about 4500 tonnes (11 per cent),” he said.

“Add to that an increase in domestic supply of around 3000 tonnes (2 per cent) during January and February and we find that the market has been working with around eight per cent more beef than a year ago.”

Looking at the latest statistics, Mr Ashworth said that speculation about the impact of Polish beef imports was unfounded. There is, he added, also no evidence of beef from Poland going into Ireland and then being re-routed into the UK as imports from Ireland.

Responding to recent discussion about the impact of imports on the price which Scottish and UK beef farmers have been receiving for cattle, Mr Ashworth said there was no indication in the trade analysis of any malpractice taking place.

The most recently available Irish customs data shows Ireland imported just 1957 tonnes of beef in January 2015. This compares with 1437 tonnes in January last year, an increase of just 520 tonnes. Almost 80 per cent of the imports of beef into Ireland came from the UK with only around 10 tonnes coming from Poland.

“For the avoidance of doubt this is tonnes of beef arriving in Ireland - so there is no evidence from trade analysis of any significant volume of beef from Poland going into Ireland and then being re-routed into UK via Ireland.”

Looking at the tonnages of beef being exported from Ireland to the UK, Mr Ashworth observed that Customs and Excise data relating to beef imports to the UK reveal that imports from Ireland increased by 12 per cent during January and February 2015, compared with last year.

This amounted to some 28,763 tonnes in total (up 3094 tonnes year-on-year) and accounts for some 71 per cent of all UK beef imports.

“While imports to the UK from Poland during the same period increased by 38 per cent (up by 455 tonnes), it is important to recognise that they accounted for only 1636 tonnes in total. This is equivalent to just four per cent of total imports of beef to the UK and 1 per cent of all the beef available on the UK market this January and February,” said Mr Ashworth.
The other country which ranked as a top three importer to the UK during January and February was the Netherlands, which saw an increase of 506 tonnes to 3119 tonnes.

Spain and Botswana were the other two countries ranking in the top five importers to the UK during January and February but again, said Mr Ashworth, these tonnages were at a low level. Just 574 tonnes of beef in total was imported to the UK from Spain and 514 tonnes from Botswana.

While Ireland and Poland may have increased the volume of beef they supply to the UK, other countries have supplied less, notably New Zealand, Uruguay and Brazil.
Customs and excise data is insufficiently broken down to be able to say what quantities of beef is being imported from outside of the UK into Scotland but the UK statistics give a very clear indication of the overall picture, said Mr Ashworth.

Recognising the difficult start to 2015 which beef finishers have endured, he said there were a complex range of factors affecting prime cattle prices, many of which are outwith producers’ control. However, the coming months look more encouraging for beef producers as the supply and demand pendulum starts to swing back towards farmers.

“We know the availability of prime cattle in Scotland, UK and Ireland will diminish so, in the next quarter, we expect to see the volume of cattle arriving at abattoirs slow down. It is likely we will then see some firmness in the market for the beef producer,” said Mr Ashworth.

 



Our Sponsors

Partners


Seasonal Picks

Meat Cuts and Muscle Foods - 2nd Edition