Farmer John Scott with his sheep© Jim Varney

An independent group has identified a series of changes which it says could add at least £26m a year to the Scottish sheep sector, which is already worth more than £200m a year to the rural economy.

The final report of the Scottish Sheep Sector Review sets out a 24-point action plan which aims to improve profitability at farm level, stimulate demand for sheepmeat and add value.

The review group, chaired by former Farmers Weekly Sheep Farmer of the Year John Scott, said that surveys of sheep enterprise profitability showed considerable variation in profitability.

See also: Sheep sector ‘vision’ report predicts bright future for UK lamb

There was a difference of more than £20/ewe in the gross margins of the best performing flocks and those with average financial performance.

Key review recommendations

  • Drive technical efficiency
  • Find new ways to help farmers compare business and financial performance with their peers
  • Identify ambassadors who can become advocates for the sheep sector and the quality of the product
  • Research points of difference to Scottish lamb in bid to add value

This means that improving gross margins on half of the current Scottish ewe flock by £20 would benefit the sector by around £26m a year.

The report calls for a push to improve technical efficiency. According to Quality Meat Scotland data, almost a third of lambs were outside the preferred specification and changing this could help farmers secure premiums, it said.

Ewe and lamb productivity also contributed significantly to the improvement in margin between the average flock and those in the top third, with the best farmers typically selling 25 more prime lambs per 100 ewes.

While some of these messages were not new, the report said the big challenge was getting producers to implement some of the actions needed to drive change.

Mr Scott said while the sheep sector faced challenges there was untapped potential for growth. “This report identifies a range of actions that I believe will enable the entire sector to thrive and prosper.”

Rural affairs minister Fergus Ewing welcomed the report and called on the whole of the supply chain to buy into its recommendations.