Livestock export markets face crippling hit from latest outbreak

The UK livestock industry has been left crippled after foot and mouth disease struck again this week, costing the sector tens of millions of pounds in lost business.

An immediate ban on all livestock movements, gatherings and exports has slammed the gates on livestock markets just weeks after auctioneers raced to get trading back to normal.

“Catastrophic”

Chris Dodds, secretary of the Livestock Auctioneers Association, said the latest outbreak would be “catastrophic”. “About 60% of the UK’s £1.1bn livestock market is traded between August and November.”

“Completely undermine confidence”

Traders fear that another ban on exports – worth £10m a week to the industry – would crush confidence among crucial overseas markets.

A spokeswoman for the National Beef Association warned that the outbreak in Egham will “completely undermine confidence” in British meat.

The loss of exports is likely to be felt hardest in the sheep sector. Richard Phelps, managing director of processor Southern Counties Fresh Foods, said the firm had worked to ship as much meat as possible before the ban was imposed in a bid to reduce the financial impact of the outbreak.  “We have only just recovered from the last time.”

Fall in lamb prices

The loss of exports in August caused prime lamb prices to fall more than 15p/kg to about 220-230p/kg deadweight. Beef prices dipped slightly but escaped the worst.

“We were committed to maintain the beef price in the last outbreak and we hope it won’t suffer too much this time,” said Mr Phelps.

However, smaller processors would be hit harder. Sian Pritchard, director of Caernarfon abattoir Cig Cibyn, who laid off 47 staff during the outbreak in August, said she was “very concerned”.

8000 sheep slaughtered a week

“It will affect us dramatically,” she said. “Over the past two weeks we have been slaughtering 8000 sheep a week and we exported 80% of those.”

“We hope we won’t have to lay off staff again but it depends on what happens.”

Thomas Binns, NFU livestock chairman, said: “Marts were out of business for the best part of a month last time. This time of year is usually their busiest period so there will be severe commercial pressures.”

“We are well into breeding sheep sales so it could not have happened at a worse time for sheep.  We saw some dramatic dives after the last restrictions were lifted. The export market bounced back well and robustly and the price pressure we saw was about the number of animals coming forwards after a month of closure. I have no doubt that will happen again, but this stop and start approach is very difficult for business.”

Auctioneer Mark Cleverdon said this week would have seen some 50-60,000 sheep pass through his pens in Ashford, Kent. He said there were greater fears for what this will mean for the market and farmers this time.

“Just five weeks down the line we will be in to the third week of October, which will put immense pressure on producers in terms of tupping and lengthening next year’s breeding season. Some producers won’t have facilities in place to cope with a late lambing season.”

Ram sales cancelled

Major ram sales at Builth Wells, Lanark and Wilton, near Salisbury, have been cancelled. The cancellation of a second NSA ram sale this season would see £90,000 in refunded entry fees.

“Many sheep farmers rely on these sales as a major provider of cash flow to see them through the winter period in terms of feeding and housing.”

Suffolk breeder Michael Weaver would have had 60 rams heading to sales in the next few days and now faces losing up to £18,000 of income alongside the costs of feeding these sheep.

“I had 35 heading for the NSA sale at Builth, another 10 for Wilton and a further 15 which had already been sold at home and are awaiting collection.”

Most of the big ewe sales were due to happen in the next couple of weeks, he added.