UK has increased lamb production
UK's self-sufficiency in lamb stood at 109% in 2019, 10% over the rate registered in 2018. This increase was due to both a reduction in lamb consumption in the UK year-on-year and an increase in domestic production. During the same period, lamb exports were also notably up and imports were down. However, to reduce the impact of Brexit on lamb producer in the UK access to key export market is crucial, warns AHDB. "UK lamb self-sufficiency does fluctuate from year to year, although the general trend shows an increase in self-sufficiency. This is due to UK lamb production remaining firm despite a steady decrease in domestic consumption. As domestic consumption continues to drop back year-on-on-year and the gap between production and consumption widens further, the exportable surplus of lamb is growing. Access to key exports markets such as the EU is crucial," says Charlie Reeve, AHDB analyst.
It is clear 2020, has not been a normal year by any means and lamb markets have felt the effect of this. Retail demand has remained relatively resilient and Kantar data actually suggests there have been some areas of growth for the sector especially for household lamb purchases. In contrast to this, the closure of foodservice sector for prolonged periods of the year has restricted demand for the out of home market, although the importance of takeaways for lamb has meant even here the effect of lockdown has been muted to a degree.
It is not just the domestic market that is feeling the effect of coronavirus. Demand on the continent for UK lamb exports will be an important watch point in the coming weeks and months as many countries enter a second lockdown.
Import volumes of lamb entering the UK market have been declining in recent years. This has been driven by major lamb exporting nations such as New Zealand and Australia focusing on new markets in Asia and sending less product to the UK.
Export volumes of UK lamb have been increasing in recent years, and the vast majority of this trade is with Europe. Exchange rates between the Euro and Sterling have also been favourable in helping UK exports remain price competitive. "With the UK’s exportable surplus of lamb likely to increase in the future, the need for free trade with the EU is becoming even more important.
The UK’s main market for lamb exports continues to be the EU, with over 90% of total UK sheepmeat exports going there during 2019. Without access through a free trade agreement, tariffs could undermine the competitiveness of UK product," added the analyst.
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