A new report has identified a number of opportunities to grow the UK lamb market – so what are the next steps.
Sheep farming has tremendous potential to expand in the UK, but the industry must adapt if it is to make the most of opportunities.
According to the Eblex/NFU report Vision for British Lamb Production , sheep producers can boost productivity and deliver greater economic, environmental and social benefits.
But, the industry must get better at reacting to market signals, as well as growing domestic and export sales. So how can the supply chain take these recommendations and build a vibrant, profitable future?
Step forward to make your flock a success
Independent sheep consultant Catherine Nakielny outlines five practical steps to help farmers improve their profits.
1 Condition score ewes
“This is a massive driver of production. The starting point for each season is at weaning, so score your ewes and group them accordingly,” she says.
Ewes should also be scored at tupping, with lowland producers aiming for a score of 3.0-3.5 and hill farmers 2.0-2.5.
“If you leave it until scanning you won’t have enough time to adjust condition before lambing. Ewes in good condition will be less prone to disease, and will produce more milk, leading to improved lamb growth rates.”
2 Feed budget
Matching grass growth to the flock’s need is critical if body condition is to be maintained, says Dr Nakielny. “Work out in advance what food you need to balance ewe condition, as it costs more to put on condition than to maintain it. Test your soils, measure grass growth, and consider reseeding to maximise yields and quality.”
3 Monitor lamb growth rates
“Pre-weaning you should aim for 300-400g/day liveweight gain – anything under 250g should be looked into.” Post-weaning growth rates should be 150-200g/day. “If you get the weaning right you can minimise that drop.”
4 Flock health planning
Disease prevention is always better than cure. “Ensure you get the correct diagnosis for any problems you may have – and check for anthelmintic-resistant worms,” says Dr Nakielny. “You can’t get your flock health plan and lamb growth rates right if you don’t know what you’re dealing with.”
5 Know your cost of production
“You can be doing everything right, but if you’re not profitable, what’s the point? You need to understand the link between inputs and output, only then can you do a cost-benefit analysis to aid decision-making.”
At farm level
Sheep producers have tremendous scope to improve productivity and profitability, says Adas sheep consultant Kate Phillips. “If you look at the top third of producers compared with the industry average, there is lots of room for improvement. How many farms are really reaching their potential?”
Too many farmers treat sheep as a secondary enterprise, lacking focus and attention to detail, she adds. “You need to benchmark against yourself and similar farms, to identify where you can do better.” Farmers can create flock targets by looking at the Eblex Stocktake Reports . “Identify where you can do better and make little changes each year to improve output and performance.”
However, profitability is not all about maximising productivity, warns Mrs Phillips. “It’s about optimising output for your system. The key challenge is producing lamb cost effectively; if you have an intensive system you have to catch the peak prices.”
The UK’s unique farming structure makes profitability particularly challenging, with relatively small farm sizes and a splintered supply chain. However, there are ways in which farmers can work together to improve the bottom line, says Dewi Jones at sheep breeding firm Innovis.
“A fundamental issue is we use less than 50% of our grass and forage,” he says.
Small farm sizes and divided blocks of land are part of that problem, with poor grass management also to blame. He advocates setting aside and investing in the best land as a finishing unit. “Whether you’re producing intensively or extensively, it must be a conscious decision to focus on what you do best.”
Improved genetics will help produce fast-growing, well-shaped lambs from smaller, easy-care ewes, he adds. “But we need the market signals to encourage farmers to change and meet that demand.”
Hill farms should generally be breeding ewes for sale to lowland farms with terminal sires for lamb production, says Mr Jones. But rather than buy breeding stock at market, producers should see the chain as an extension of their farm, and build a relationship with suppliers and customers.
As British farmers are notoriously bad at working together, Mr Jones recommends using a facilitator – such as a breeding company or processor – to bring partners together and form dedicated supply chains. “We’ve got to be more customer-focused.”
The low capital input required for sheep farming makes it an ideal sector to attract entrants, says SRUC sheep specialist John Vipond.
With parcels of land available on small estates, and arable farmers increasingly incorporating pasture into the rotation to tackle grassweeds and low soil organic matter, new entrants can secure sufficient grazing relatively easily.
But what about the cost of sheep? “New entrants should not buy stock, but manage the groups that other farmers find give a lower return,” says Dr Vipond.
“For example ewe lambs can be ‘borrowed’ for a year. The new entrant keeps the progeny while the owner pays for increase in liveweight and gets back stock that can be run with the rest of the flock, making management easier.
“Similarly, a winter on a lowland farm could put weight on cast hill ewes or boost lambing percentage of regular age groups by about 40%. As cast ewes they could be lambed and sold when prices are high to increase their value and meat production potential, thus growing the industry.”
The British lamb industry’s greatest strength is the product itself, according to Greg Mowbray, managing director at Meadow Quality Foods. “It is succulent and tasty with excellent green credentials that we really should exploit more. It ticks all the boxes of wholesome, healthy food.”
However, the biggest challenge is poor visibility of forward production. “We don’t know how many lambs are coming forward from one week to the next; and numbers tend to peak in August, when demand is at a seasonal lull,” he adds.
“Retailers need to feed back a demand curve to producers, who must manage their finishing times accordingly.”
Even dedicated supply chains are not transparent enough, says Mr Mowbray. “I’m staggered at how short term lamb buyers work – they don’t know what they need from one week to another; it would really help to have targeted contract amounts.”
One of the biggest challenges facing the industry is weakening domestic consumption. To combat this, the industry needs to innovate and produce more convenient cuts that are cheaper and less wasteful, says Mike Whittemore, trade marketing manager at Eblex.
“Rather than selling a leg of lamb at £25, butchers should consider cutting it into smaller joints and muscles which are more fit for purpose. Lamb is a premium product and we need to capitalise on that to better meet consumers’ needs.”
While retail demand declines, the food service sector is growing, offering great potential for hogget producers, says food service projects manager Hugh Judd. “Consistency is a big problem – caterers want bigger [not fatter] carcasses as they’re more efficient. But abattoirs pay less a kilo for heavier lambs, which is a disincentive to producers.”
Farmers should, therefore, develop direct-supply agreements with catering butchers, ensuring consistency of supply and eliminating the vagaries of the market.
Another growing sector is halal lamb, both within the retail and food service markets, says Rizvan Khalid at Eblex. “Demand for mutton fundamentally underpins the ewe market.”
But the key challenges are building trust over quality control and stunning before slaughter, with improved labelling essential. “Half of all sheep are slaughtered for the halal market , and 90% of these are stunned,” he adds. “Education and transparency are needed more than ever.”
Lamb exports are growing steadily, rising by 2% in the first half of 2014, says Eblex export manager Jean-Pierre Garnier.
“There is a shortage of lamb worldwide so we’re ideally placed to expand exports, but we need to ensure importers are aware of the product and how to source it.” More stringent border controls are also required, to preserve the UK’s disease-free status.
New markets such as Saudi Arabia, America, Africa and Japan help to balance the carcass, he adds. “Lamb is consumed in many different ways around the world so we have to keep innovating.” Traditionally, whole carcasses were exported, but now 48% of sales are cuts.
“This has been driven by a 59% rise in bone-in cuts, with boneless cuts increasing by 22%.”