Sheep crisis measures meet mixed reception

9 October 1998

Sheep crisis measures meet mixed reception

By Robert Harris

and Allan Wright

A RANGE of measures designed to relieve pressure on the UK sheepmeat market have been welcomed by farmers leaders in a week which saw finished lamb prices drop 7p/kg, to below 69p/kg.

However, they are viewed as holding measures, rather than answers to the crisis, and some traders remain sceptical.

EU private storage aid for sheepmeat from the UK and Ireland, recently announced by Brussels, could take 2850 tonnes or 142,000 lambs off the market – less than a weeks supply.

Aid is set at about £965/t. Meat has to be frozen for three to seven months before being released. The Intervention Board will invite tenders which must be lodged between Oct 19 and Nov 20. A maximum of 2400t has been set for the UK and 450t for Ireland.

The move will help stabilise the market, says NFU president Ben Gill. "We see this speedy response by the UK Government and the EU committee as a much needed sign that the concerns being expressed by the NFU and our members are being heard."

Malcolm Morrison, SNFU livestock committee convenor, added that the move should help put a much needed bottom in the market.

However, not all parties share that optimism. In March, a similar scheme attracted no British lamb. Only 133 tonnes from Northern Ireland and 20 tonnes from the Republic were actually taken off the market.

Alan Craig, general manager of ABP Bathgate, which slaughters 15,000 lambs a week, says the firm will decide whether to tender by the weekend. "There is little or no value in the skin and offal which is usually a key factor when doing sums for private storage."

Not attracted

Aberdeenshire wholesalers Ralph Green, of McIntosh Donald, and Raymond Wight, of Scottish Premier, are not attracted by the scheme. "It would only be feasible is you had a catering buyer lined up beforehand," says Mr Wight.

Edward Hamer, Powys, says traders have to take all the risk. Frozen meat released from stores in March and April will have to compete with New Zealand supplies, he adds. "Given the strength of its dollar, New Zealand will have a big currency advantage."

Other measures include the resumption of trade in whole ewe carcases to France yesterday (Thursday), 11 days earlier than expected.

Claw-back hopes

Owen Owen, of Cig Mon Cymru, eventually hopes to claw back his 5000 ewes a week trade to France. But farmers, who have seen ewe prices halve to 30-40p/kg since the January ban, will have to wait for prices to recover. "We should have a fairly regular trade in six months, but it might take a year to recover fully."

Some cashflow relief is likely in Scotland following government assurances that the second advance of the 1998 sheep annual premium, worth £4.89 per ewe, will be paid from October 16.

And Asda red meat manager Brian Haigh recently announced that the group had cancelled orders for £150,000 worth of New Zealand lamb this year and would review its policy for 1999.