Despite a marked slowing of trade in the second half of the year, the latest figures from the English Beef and Lamb Executive (EBLEX) reveal that national sheep meat exports continued their recent annual growth in 2006.

Up by just over 2% on 2005 at 87,000 tonnes, annual exports edged towards the 99,000 tonne peak recorded in 2000 before the FMD-related ban brought the trade to an abrupt halt. Reflecting the improved conditions of the first half of the year in particular, the annual value of exports rose by almost 8% to £230 million.

The annual improvement was, however, entirely due the to the strength of the trade over the first six months of 2006, favourable market conditions and a good availability of lambs resulting in a 16% increase in exports compared with the same half-year period in 2005.

In contrast, export volumes in the second half of the year were 7% down on 2005. This was a consequence of a steady increase in the strength of sterling against the euro, as well as increasingly difficult economic conditions in the main continental markets.

While still only relatively small, the proportion of exports in the form of value-added cuts rather than carcases rose encouragingly to 14.4% compared to the 7-8% in 2000. Trade to France accounted for 70% of total exports as against a historic 75%, suggesting a welcome diversification of markets. This is confirmed by annual export volume gains of 7% and 10% achieved on the Belgian and Italian markets respectively versus just 0.3% in France.

Even so, with 30% of UK lambs now being exported and the bulk of these continuing to go to France, the French trade clearly has a major influence on the home market. In this context, it is not surprising that the particularly disappointing prices realised towards the end of last year coincided with year-on-year declines of 20% or more in monthly exports to France.

Nor is the solution necessarily for more lambs to be held over until the New Year, as appears to be the case again this season. Since the first quarter of the year is traditionally a relatively flat time for exports, more lambs on the domestic market only tends to put pressure on prices.

Although exporting conditions remain challenging, 2007 exports are forecast to be at a similar level to last year. This will, however, depend upon the state of the French economy, the sterling:euro exchange rate and competition from other exporters – most notably New Zealand.

The availability of English lambs will also continue to be a major factor, with sufficient supplies at the peak of the exporting season in the autumn/early winter critical to maintaining volumes. Retaining such a traditional seasonality of marketing will be valuable in limiting the potential knock-on effect of a overhang of old season lambs onto the new season market.

Longtown Primestock Sale - 26th April 2007
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