The future strength and development of Scotland’s meat industry is delicately poised as we approach 2014 says the Scottish Association of Meat Wholesalers (SAMW).

“The potential for growth and development for our industry is enormous, with strong export opportunities emerging on a regular basis,” said Alan McNaughton, SAMW president. “However, extremely tight livestock supplies and a sharp rise in cattle prices in recent months are having a limiting effect on business development, with the likelihood that similar pressures will carry over into next year.

“There have been many points of progress in the past year but in almost every instance each new gain or opportunity has been accompanied by a risk or a threat which could prevent our industry from fulfilling its potential.  For example, securing Scottish Government agreement to an 8% coupled payment for beef calves through CAP Reform, up from the previous 4.5%, was obviously a 2013 highlight achievement. Unless the rest of the CAP package delivers what productive farmers need to commit to beef long term, however, we could still see the new coupled payment advantage being swept away in 2014. 

“The whole industry is delicately balanced at present, therefore, with the potential for real advances to be made on one hand, or for producers, on the other, to decide that their combined package of CAP payments doesn’t add up to enough to take them forward.  A negative response on this would be a massive disappointment, given the growth of export opportunities which are now available to Scotland’s meat sector. Everything depends, however, on getting sufficient livestock to supply traditional home market outlets, which have long been our industry's bread and butter, as well as meeting new export opportunities.

“What is already clear is that the current supply/demand/price pattern cannot continue much longer without causing serious damage to our industry. Cattle prices have risen by 15% since the beginning of 2013 while market returns have increased by just 7%..  There is no way these two figures add up.  Commercial reality dictates that the current high prices cannot last forever without driving processors out of business, and/or driving consumers away from beef. If that happens, then Scotland’s processing capacity will shrink, our meat sector growth potential will decline and we’ll be left watching other countries fill the gaps which have been created.

“Representative bodies in Scotland along the entire supply chain are working hard to achieve a sustainable business model which rewards all of those involved. Nevertheless, having seen beef cow numbers decline by 60,000 since the last CAP reform in 2004, none of us can afford another wrong conclusion.”

Turning to other positive/negative developments in 2013, Mr McNaughton took first aim at continuing concerns regarding bureaucracy and red tape.

“There’s no doubt we’ve made progress on these factors this year but there still seems to be a mountain to climb in relation to far too many points,” he said. “Prime examples of this include the torturous process we’ve been faced with during the implementation of new animal movement regulations and the introduction of new certificates of animal welfare competence for plant workers.

“The first point to make is that SAMW members fully support high animal welfare and supreme worker competence, always have and always will. What we don’t like is the imposition of unnecessary rules and regulations which don’t work, succeed only in disrupting previously efficient processes and definitely don’t improve either welfare or product quality.  As an Association, we have spent a huge amount of time on these issues in the past year. Although we’ve often reached a final position which is acceptable to our members and regulators, it invariably takes us far too long to get there. We would greatly appreciate earlier involvement in such key decisions, especially where a measure which is discussed in a committee room in Brussels, London or Edinburgh, proves totally unworkable once it is applied to a real farm or abattoir operation. 

“On animal movements, for example, we have gone from plant operators having the freedom to return unsuitable or unsaleable stock to farms, to a restricted process in which SAMW members are being penalised for failures and irregularities for which they have no responsibility, or have no practical control over in the commercial and competitive environment.

“Similarly on welfare certificates, we faced the threat of having to train and test experienced plant workers in tasks which they’d been performing successfully for many years. Thankfully, we now have an agreed position to the effect that only new plant staff members have to be trained and tested. A move to in-house training and testing, where appropriate, has also been agreed, rather than an unnecessarily expensive external system. We still have serious doubts about the cost of certifying new entrants, however, given that the practical outcome will be no different to the system which is being replaced.  Frankly, more discussion ahead of the original decision would have saved a lot of time and effort on all sides.

“Progress is also being made towards the formation of Scotland’s new food body, ahead of its vesting date of April 1, 2015. This was always going to be a relatively slow exercise, although one which we believe, potentially, has long-term value written all over it. We signed up to the new body as an opportunity to improve communication and collaboration between plant operators and regulators, with the firm promise of improved efficiencies delivering reduced meat inspection costs.  We are already seeing greater collaboration across our industry in terms of inspection issues, which is to be welcomed. Equally, we continue to look forward to the delivery of meat inspection on the promised reduced cost basis, an outcome which will benefit all parts of the Scottish food chain for a long time to come.”

The president also commented on the steady removal of BSE restrictions, a process in which SAMW  has played a significant part.

"We continue to seek sustained progress on remaining BSE-linked  regulations  with the further removal of restrictions always being sought only in line with clear science-based evidence," he said. 

"Another issue on which we have been working hard, and showing real success, is the modernisation of meat inspection. Having secured a new structure for pigs in 2013, we look forward to achieving similar advances for sheep and cattle in 2014.

“In each and every one of these points, therefore, SAMW is delighted to be able to record the achievements which have been made, the regulatory adjustments which have been put in place and support platform which is being built for 2014. At the same time, we remain keenly aware of the delicate state of our industry, the work which still needs to be done and the challenges which face us all in the coming months.”