Quality Meat Scotland (QMS) received 8% less levy income last year, as stock numbers continued to fall and more animals were slaughtered south of the border.
The statutory red meat levy brought in £4.1m over the 12 months to March, down from £4.4m in 2012-13, according to the body’s annual review.
QMS put this down to the “double-edged sword” of lower production and more stock being killed in England, shown by a 12% drop in the number of animals slaughtered in Scottish abattoirs.
Chief executive Uel Morton said declining levy income meant QMS had to keep using the budget available to return maximum value for money for levy payers.
“We must remain light on our feet and respond robustly to the challenges and opportunities in front of our industry,” he said.
Though the levy accounts for more than half of QMS’s income, the body turned an operating deficit of £307,000 into a £59,000 surplus.
Grants from the Scottish government totalled £1.7m in 2013-14, compared with just £50,000 the year before.
Speaking at the review’s launch, QMS chairman Jim McLaren said the long-term prospects for Scottish red meat industry remained very positive.
He picked out that while the December 2013 census showed more decline in breeding cow and ewe numbers, the sow herd had begun to steady.
Mr McLaren said rising farmgate prices, falling feed costs and the takeover of the Brechin abattoir by two farmer co-ops had sent positive signals to pig producers.
“The sense of trepidation earlier in 2014 was particularly keenly felt in the beef sector, where most analysis of the predicted CAP changes suggested a significant reduction in payments by the end of the transition period,” he said.
“We now have more clarity on the way forward and I am confident in producers’ ability to get to grips with what the changes will mean for their individual businesses.”