© Livestock & Meat Commission for Northern Ireland 2015 Vegetarianism.
Meat Industry Ireland
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Transcript of Meat Industry Ireland
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Meat Industry Ireland
Presentation by
Joint Oireachtas Committee on Agriculture4th March, 2014
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Overview
• Snapshot of where we are
• Beef Industry performance over the last decade
• Current market situation
• Market specifications
• Young bulls
• Real threats & challenges
• Conclusions
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Snapshot – a lot done under FH2020
• 40% increase in finished cattle price over last 4 years
• Additional €1.5 billion to Irish beef farmers
• 101% of EU male cattle price / 107% of ‘all-category’ EU price
• 3rd highest steer/cow price; 5th highest heifer price
• €2.1 bn beef exports in 2013 (+10%)
• Irish beef exports have increased by almost 35% since 2010
• Moved from 75% to 87% QA coverage
UK Continental EU
Int. Markets0
50
100
150
200
250
237211
5
250214
8
+5%
+60%
+1%
Irish Beef Exports 2013472,000 tonnes
+4%
€2.1bn
+10%
Ireland exporting
90% of beef
output
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Irish Beef Sector
Performance of the last decade
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Irish beef listed with more retailers than beef from any other origin
75+2001 2014
27
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Sales of Irish beef to Retail (‘000 tonnes cwe)
Source: Bord Bia
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013(E)
0
50
100
150
200
250
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Irish R3 Steer Prices, 2001 to date (c/kg)
Source: Dept. of Agriculture
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013200
250
300
350
400
450
c/kg
Cattle price up from €3/kg in 2010 to €4+/kg
Performance of Irish Cattle PriceR3 steers c/kg excl VAT
Jan 10
Mar
10
May
10 Ju
l 10
Aug 10
Oct 10
Dec 10
Feb 11
Apr 11
Jun 11
Aug 11
Oct 11
Dec 11
Feb 12
Mar
12
May
12 Ju
l 12
Sep 12
Nov 12 Ja
n 13
Mar
13
May
13 Ju
l 13
Sep 13
Nov 13
0
100
200
300
400
2010: €2.91/kg
2011: €3.44/kg
2012: €3.86/kg
2013: €4.07/kg
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Current Market Situation
Production, Consumption, Prices
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Market Overview• Consumption under pressure – weaker consumer spending
power• Many key export markets in recession• No significant promotional activity in beef category - beef
relatively expensive compared with chicken & pork;• Manufacturing beef trade weak• Significant volumes of additional pork on EU market due to
Russia ban• Significant stock levels across Industry – product not moving at
present• Irish cattle slaughterings up 7%• Production up in EU• UK prices falling since October – only starting to stabilise now
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GB Cattle Prices
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France
Germany
Italy UK
Spain
Ireland
Netherlands
Poland200
400
600
800
1000
1200
1400
1600
2012
2013(e)
2014(f)
EU beef production trend 2012 - 2014
+2%
N/C.+0.8%
+2.6%
+7%+3% -1%
+1.0%
Source: EU working beef forecasting group
EU beef production declined by 2.2% in 2013.A recovery in production of 1.1% is forecast for 2014
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2009 2010 2011 2012 2013(e) 2014(f)6,400
6,600
6,800
7,000
7,200
7,400
7,600
EU beef consumption, ‘000 tonnes
Source: EU working beef forecasting group
Beef consumption decline in 2013
-2.1%
Retail sales of beef throughout EU
Italy (Jan to Dec)Volume : -3.7%Average price -2%Spain (Jan to Dec)
Volume : -4%Av Price +2%
Germany (Jan to Dec)Volume : -1.5%Average Price: +3.5%
France (Jan to Dec)Volume: -4.0% Av Price: +4.2%
G. Britain (52wks to 5 Jan)Volume: -2.9%Av Price: +7%
Home Market (52wks to 5 Jan)Volume: -5.0%Av Price: +4.1%
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-16.0
-14.0
-12.0
-10.0
-8.0
-6.0
-4.0
-2.0
0.0
-2.9-1.6 -1.5
-7.7 -8.1 -8.2
-14.5
Beef sold at UK retail - Annual volume change %52 wks to 5th Jan '14
% D
eclin
e in
Vol
ume
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Growing the success of Irish food & horticulture
Low consumer demand for beef is holding back the market, as rising beef prices in the past few years have turned some on to other meats.
Farmers Weekly 27/2/2014
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Jan '13
Jan '13
Feb '13
Mar '13
Mar '13
Apr '13
May '13
Jun '13
Jun '13
Jul '13Aug '13
Aug '13
Sep '13
Oct '13
Oct '13
Nov '13
Dec '13
Dec '13
Jan '14
Feb '14
250
300
350
400
450
Ireland R3 Steer vs. Continental Europe R3 Y. Bull(c/kg excl. VAT)
Ireland R3 Steers
Continental Europe R3 Young Bull
Producer Prices: Ireland vs. Europe
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Producer Prices: Ireland vs. Europe & UK
Jan '13
Jan '13
Feb '13
Feb '13
Mar '13
Mar '13
Mar '13
Apr '13
Apr '13
May '13
May '13
Jun '13
Jun '13
Jul '13Jul '13
Aug '13
Aug '13
Aug '13
Sep '13
Sep '13
Oct '13
Oct '13
Nov '13
Nov '13
Dec '13
Dec '13
Jan '14
Jan '14
Feb '14
Feb '14
300
350
400
450
500
Ireland R3 Steer vs. UK R3 Steer & Continental Europe R3 Y. Bull(c/kg excl. VAT)
UK R3 Steers
Ireland R3 Steers
Continental Europe R3 Young Bull
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Market Specifications• Steer / Heifer grass-fed – unique selling point – clear message from
consumers & key customers for years now
• FH2020 & Beef Activation Group reports highlighted market specification issues
• Post FH2020 MII members introduced QPS – rewarding quality
• In-spec bonus – QA and specification
• Young Bulls – UK retail requirement is for <16 month only. Limited opportunity for some older YBs in Continental markets – processor specific
• Must have Producer-Processor arrangement for YBs over 16 months. This has been clearly communicated by FH2020 Report and by Individual processors
• MII has prepared a draft Industry Communication to again highlight importance of specification adherence - farmer gets a better price & industry can better market the output
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Young Bull Kill – YTD(head/week)
05.01.14 12.01.14 19.01.14 26.01.14 02.02.14 09.02.14 16.02.14 23.02.142,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
Total kill up 7% ytd
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Real Threats/Challenges
• EU Trade Deals – Increased tariff-free imports• EU-Canada CETA• EU-US TTIP• EU-Mercosur
• On-Farm Efficiency• Significant advantage still to be achieved behind farm-
gate• Industry has supported initiatives
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Conclusions• Strong beef sector marketing performance & price delivery
• Weakening price due to market conditions, but prices still at upper end of EU market
• In-spec essential – will deliver the best returns
• Industry responding to short-term supply issues
• Positive outlook in medium term
• Challenge – Trade Deals / On-farm productivity