The value of the French market

Opening up new and often far-flung markets for UK beef and lamb is a key element of the EBLEX strategy, but we should not underestimate the significance of more established export markets closer to home.

France represents the single most important export market for our lamb, with around one in every five lambs born in the UK ending up on a French plate. In 2010, France was the destination for 60% (57,400 tonnes) of all UK sheep meat exports.

In terms of beef exports, the quantities are far more modest, however significant inroads have been made since the 2007 foot and mouth disease outbreak severely eroded French trust in our product. In 2010, beef exports increased by 26% to 10,000 tonnes, indicating a strong recovery in this trade. It is also important to note that in terms of quality beef, France is one of our main markets.

The success of farm assured beef and lamb on the French market is due in no small part to the work of the AHDB France office, based not far from Paris in Fontainebleau. Our colleagues in France have worked hard to create a positive image of the product and build fruitful relationships with the French supply chain.

Developing brands has been a key aspect of our strategy in France, with the establishment of the Agneau St George (St George lamb) brand, which has helped differentiate the product and communicate messages to consumers about the taste and tenderness of farm assured lamb. The brand has a growing presence in the major French multiples, supported by in-store promotional activity, and has proved so successful that is has now been extended to include beef (Boeuf St George).

Running in parallel to the development of Agneau St George, the Agneau Presto (quick lamb) campaign, which is a joint venture involving EBLEX and our UK, French and Irish counterparts, was launched in early 2008 in order to reverse a 10-year trend of falling lamb consumption in France. The campaign targets younger consumers by promoting quick, simple lamb recipes, with the aim of transforming lamb from an occasional treat into something which is consumed more regularly.

The specific trust issue around beef exports has required a very different approach, in the form of the establishment of the Rosbifs Club. This exclusive group of key opinion leaders from the French food industry, including butchers, chefs and food writers, come together every six months, on one side of the channel or the other, to see the supply chain in action, and, of course, to taste the product. The result is a group of very influential advocates of quality beef.

As we aim to meet our objective of maintaining lamb exports at a third of production and increasing beef exports to 20% of production by the end of 2012, it is impossible to overstate the importance of these activities in such a key export market.

Will the beef industry benefit from thaw in Russian trade relations?

At first glance, It had all the ingredients of a John Le Carré novel, not least the KGB’s apparent attempt to recruit a young future British Prime Minister into its ranks. Yet while the David Cameron’s visit to Moscow last week certainly made for sensational headlines, it could also have far reaching implications for the beef industry.

For anyone involved in the beef sector, the major steps taken to re-establish trade links can’t have escaped attention. The long-standing Russian ban on British beef is a subject that EBLEX, together with Defra, has been working hard to address for some time.

Russia is one of the largest global importers of beef, buying more than 600,000 tonnes each year, historically much of it coming from Brazil and other South American countries. However, supplies from Brazil have tightened in the last couple of months after Russia delisted some 85 plants.

These substantial imports into Russia have largely been driven by a long-term downward trend in domestic production. Total cattle inventories are expected to shrink to 16 million head this year, down four per cent, on top of a three per cent decline in 2010. The accelerated decline has been caused by increased feed costs, exacerbated by a 25 per cent decline in feed availability at the start of 2011, compared with 2010.

These two elements point us to the same conclusion – the potential for beef exports to Russia is enormous. The question is: “How does the UK capitalise on it?” As mentioned earlier, Brazil and other South American countries dominate exports to Russia, but the increase in exports from the EU has been nothing short of meteoric. They increased by more than 350% in 2010, compared to 2009, making it the second largest beef exporter to Russia. Coupled with fading fortunes for Brazil, that could mean that in 2011/12, the EU fills an even larger share of the Russian order. Good news indeed – the only (substantial) fly in the ointment being the fact that at present the UK can’t benefit from this increased trade due to a continued BSE-related ban. Ironically, there are several member states within the EU which have trade relationships with Russia despite having higher instances of BSE than us. If beef exports were to resume, our estimates suggest the market could be worth around £115m to the UK in the first three years. That’s based on a conservative two per cent market share.

The opening of the Russian market is part of EBLEX’s ongoing export strategy to secure new market access to optimise returns for producers and processors in England, particularly useful for those cuts for which there is low or no demand domestically. To this end, through the Export Certification Partnership with Defra, we have placed Russia as a top priority in terms of market access and the lifting of import restrictions. As well as high level contact at a technical level, EBLEX also asked for the matter to be raised at ministerial level. The fact that this was on the agenda during Mr Cameron’s visit shows the importance everyone is now attaching to this issue. By putting the issue on the political map, we hope the profile of the discussions will be permanently raised, driving us ultimately towards the goal of opening the Russian market, something which could be achieved in a relatively short period of time if the political winds are favourable.

The truth about statistics

A recent episode of the BBC science programme Bang Goes the Theory included a feature which appeared to be, at first glance, yet another of the increasingly frequent media attacks on red meat consumption because of alleged health risks.

One of the presenters was handing out bacon sandwiches on a market stall, accompanied by a sign reading ‘bacon increases risk of bowel cancer by 20%’.

He then produced a second plate of bacon sandwiches and another sign which read ‘bacon increases the risk of bowel cancer from 5% to 6%’.

As he tried to give away the sandwiches to passers by, the vast majority opted to take them from the second plate, afraid of their massively increased risk of bowel cancer if they picked one from the first plate.

Of course, as he eventually pointed out, the bacon sandwiches on both plates were exactly the same, as was the increased risk of bowel cancer associated with eating them. Both signs gave the same message, but expressing it in a different way completely changed the public perception.

Whether the bowel cancer statistic is correct is a completely separate debate which we have already addressed in the facts about red meat and health, however the programme is a great illustration of how statistics can be used to influence public opinion.

For the meat industry, which is often targeted by single issue groups who use statistics as ammunition to make people question their meat eating habit, TV programmes like this which help make the public more statistically-savvy can be no bad thing.

EU puts bovine EID in the spotlight

Notifications of animal births, deaths and movements have long been the subject of criticism from farmers for a number of reasons.

Largely driven by concerns over labour and equipment costs linked to the administrative burden involved in registering notifications in the EU, the criticism is understandable. Currently, all notifications must be manually registered and are then inputted into the national computerised database.

However, labour and equipment are not the only concerns, with criticism also being fuelled by the potential implications for cross-compliance payments, which may lead to reductions of the Single Direct Payment and other Common Agriculture Policy (CAP) schemes.

The issue has clearly struck a chord across Europe, and the European Commission has published a proposal on bovine electronic identification (EID) which could pave the way for the introduction of a voluntary bovine EID system. The proposal would also allow member states to introduce mandatory bovine EID at national level.

Generally the view in the industry seems to be that, with proper consultation and proper thought being given to the practicalities, bovine EID would be a positive step. Undoubtedly, it would present less of a technical challenge than sheep EID. Both the cost and the practicality in the cattle sector make it a more attractive proposition, essentially because there are fewer movements and more valuable animals to stand the cost of the EID tags and reading equipment. EID in the sheep sector is fraught with difficulties, but in the cattle sector the challenge would be more proportionate to the benefits.

There is little doubt that the industry would prefer a voluntary system, as there is still the issue of cost-effectiveness, meaning that for some EID in cattle would not stack up financially. However, with EID on farms becoming more common place especially for those with sheep interests, there is less anxiety about the introduction of bovine EID.

We would hope and expect the UK to take the view that it would not like to push a mandatory scheme. In the beef sector, there are already a number of producers voluntarily looking at EID to improve their management. The number of farmers investing in the hardware and software to make the most of EID within their sheep enterprise is increasing. If producers are already using it for sheep, the opportunity to reduce the administration involved in cattle movements is a major incentive to consider using it on the cattle side. Ultimately, it comes down to management benefits. If producers can record more and better information, and use the information to increase the efficiency of the production process, that will drive the use of bovine EID forwards.