REOPENING THE MARKETS:

LEARNING FROM 8 YEARS

OF MEAT EXPORT SUCCESS

J.P. Garnier

Food Matters 20 November 2014

The big picture

1.8 billion

middle-class

people in 2010

4.8 billion

middle class

people by 2050

The big picture

Meat consumption will grow by 60-100% by 2050

Trading of poultry, pork and beef to increase to 23

million tonnes by 2021

Sustainability will become a key issue

Growth to take place in Asia, Africa and South America

The largest rise will take place in the first part of the

period

More spent on premium products

Implications of the of the rise of the world’s middle class

Adapted from McKinsey (2013)

China’s Urban

Households m Private Consumption Yuan trn

0

100

200

300

400

2012 2022

0

10

20

30

2012 2022

By income class – Annual disposable income per urban household, Yuan 000s, 2010 real terms

Rich > 229 Upper-middle 229-106 Lower-middle 106-60 Poor < 60

Chinese opportunity

Where next for British meat

exports?

1,032 1,109

1,520

1,737

1,907

2,325 2,221 2,348

2006 2007 2008 2009 2010 2011 2012 2013

Exports of livestock products 2006-2013 (£ m.)

Growth is

constrained by

limited supplies

Exports of livestock products

Poultry , 314,298,883

Poultry Offal , 15,129,937

Sheep meat, 381,595,993

Ovine Offal , 4,117,331

Beef, 371,817,692

Bovine Offal , 40,676,734

Pork, 215,580,877

Pig Offal , 25,806,690

Bacon, 38,829,284

Prepared or Preserved meat, 207,129,247

Processed beef, 25,470,178

Processed Sheep meat, 1,038,507

Processed Pork 45,866,361

Processed poultry, 125,697,139

Fats (e), 58,979,803

Hides and Skins, Leather and Wool,

391,174,817

Livestock and germanplasm (e),

20,000,000

Game - venison (e), 20,000,000

Green Offal , 45,065,535

Exports of

livestock

products 2013

£ 2.38 bn.

2013 (£)

Source; elaborated from AHDB M.I. data

Exports of lamb and mutton

Sheep meat exports

000s t., Adapted from AHDB MI data

0

50

100

150

200

250

300

350

400

450

Recorded exports

Production

Est. Exports

Expon. (Recorded exports)

Third Country sheep meat exports

2008-2013 (tonnes)

1,223 2,504

4,142 5,834

12,270

17,182

2008 2009 2010 2011 2012 2013

Lamb export

Consistent work with continental retailers.

Trade and gastronomy PR and marketing

Consumer marketing (e.g. new 6 countries EU lamb promotion project)

Trade development activities in third countries.

21/11/2014 CONFIDENTIAL

Beef exports

41,241

59,371

81,350 83,308 84,312

144,299

119,770

105,012

2006 2007 2008 2009 2010 2011 2012 2013

Carcase beef exports 2006 - 2013 (tonnes)

Source: AHDB MI

2014

British beef prices are consistently the highest in Europe. The price difference between an Irish and a British steer is now € 360.

Production available for export is limited.

Due to higher demand for home produced beef, more product stays in the UK.

Retail price pressure in Europe.

Beef: the market

Beef: the market

Our export strategy is:

a) to position English beef as a

premium grass-fed, matured

product for food service (US beef

is our main competitor)

b) to optimise return on commodity

cow beef and fifth quarter

products

Sensory quality

Tradition, history and culture

Grass and water: naturalness, environment and purity

Nutrition from grass-fed beef

Pork exports

Pork exports

5 5 5 9 4

12 3 2

12 15 10

4 12

19

6 11

17 13

19 17 15 24

45 36

43 50

43 53 52 49

73

94 98

128 131 136

209

258

215

194

36

90

69

84 92 95

99

118

104

131

144

154

181

1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011

Pork exports 1961-2013 (000s tonnes)

Record exports

as percentage

of production

Source: HM Revenue & Customs

Pork exports

Added value

opportunities for

sausages and pies,

added value and

Internet sales in the

Far East

Offal exports

We exported around 85,000

tonnes of bovine, ovine and

porcine offal worth £ 145m in

2013.

According to an EBLEX

study, the percentage of

edible product in beef cattle

has increased from 38 to 48%

and for sheep from 46 to 53%

[huge variations]

Main developments in Asia

and sub-Saharan Africa.

Opening markets

We can now export 113 countries and territories for pork, 105

for lamb and 95 for beef.

Key stage of market access for China, Japan, USA, KSA...

Time consuming task…

France Austria The opportunities for export are massive despite our high

prices.

The UK is strategically placed with natural, reputational and

historical advantages.

Great product with unique USPs.

Issues: supplies, price volatility, availability of cuts,

consistency, service.

Team game

High level of marketing support needed to support premium

offer.

Where next for British meat

exports?

Thank you