Sheepmeat markets will continue to evolve

Irish sheepmeat exports have changed significantly since the early 2000s, with value-added or boneless sheepmeat exports continuing to grow at the expense of exports in carcase form. Speaking at last week’s hill sheep conference, John Walsh, general manager of Irish Country Meats, said the volume of sheepmeat exported in value-added form is now upwards of 70%. This is a complete change in just 10 years, with John predicting that sheepmeat exports will continue to evolve and reach close to 100% of exports in value-added form over the next decade.

The change in focus to value-added products has also been the catalyst for Irish exports gaining increased market share in premium or high-value markets, a situation John says has helped in providing more stability to the trade.

“When we sent 85% of our lamb to France and the UK, our first job every Monday morning was to check how the market in Rungis (Paris) or Smithfield (London) was performing. There were huge fluctuations in the trade and it was difficult to do business. Reducing the reliance on these two markets and also developing other trading avenues for premium products (in France and the UK) has allowed us to return a better price. There are still fluctuations, but they are less significant now.”

A reduction in the volume of New Zealand sheepmeat on the EU market was also highlighted as opening the door to increased Irish exports. John forecasts that growth in these areas remains positive, with an increasing volume of sheepmeat available to export delivering greater marketing potential to Irish processors.

Positive

“We have to be positive about Irish sheepmeat exports. We have processed 500,000 extra sheep in the last five years and moved it. Yes, a little of this has happened outside of our control with New Zealand paying greater attention to sheepmeat exports to China but it must also be said that the reputation of Irish sheepmeat is improving all the time. German customers to our plant are surprised Irish sheep live outdoors. They are accustomed to indoor finishing and it shows us we have a product that ticks every box.”

John says that access to the US and Chinese markets could be a game-changer in underpinning further growth but says for this to happen the sector must conform to the clean livestock policy and implement full electronic tagging to boost traceability.

“The US and Chinese markets demand greater traceability with EID central to achieving this goal. The US has a zero-tolerance stance on carcase contamination and any shortfall in this regard is a black mark straight away. The US market provides huge opportunities for high-value cuts, while the Chinese market would be very beneficial in underpinning demand for lower-value cuts giving more balance to sales. We must keep working towards gaining access.”

Responding to a question on how New Zealand and Australia have gained access to these two markets without EID, John says: “It’s not just the US and China that EID is important for. We have customers in Belgium, for example, who have switched from New Zealand to Irish lamb. New markets are very hot on traceability and are looking at all their options. At the moment, the UK has stolen a march on us with full EID tagging and we need to be in a position to offer robust traceability to gain access.”

There was a downbeat forecast on the likelihood of market recovery for light lamb carcases (less than 16kg). “We need to move on from the traditional light lamb markets in Spain and Portugal. There is some seasonal demand for light carcases and, typically, this falls around ethnic festivals. Our markets generally want a minimum carcase weight of 17kg to 18kg and this is something we don’t see changing, ” John says.