T. 07768 654955 E. scott.walker@scconsultancy.uk
Food, farming, research and business leaders, including SAMW President, Andy McGowan, have put their name to a letter to Edinburgh University, following the recent defeated motion to ban beef products being sold at the university.
Dated 19 February 2020, the letter read:
Dear Professor Mathieson, Mr Wilson and Ms Silverstein,
As bodies supporting the Scottish agricultural and red meat industry, we are writing with regard to the recent motion to cease the sale of all beef products in Edinburgh University Student’s Association cafes and restaurants.
Whilst the result of the vote was against the motion (58%), we feel this is an opportune moment to highlight some of the many positive environmental credentials which underpin Scottish red meat production, which is globally renowned for its high standards of animal welfare.
It is vital to note that Scotland’s sustainable livestock production systems differ to elsewhere in the world. We have an abundant, natural fresh water supply and produce quality beef from the grass and rough grazing which make up around 80% of Scotland’s agricultural land. This area is not suitable for cereal, fruit or vegetable production and thus couldn’t support a notable switch to plant-based diets. Scotland’s grassland also acts as a carbon sink and grazing animals provide habitats for wildlife and help to maintain the landscape.
As an industry, we work hard to communicate these facts to consumers. We also advocate that anyone wanting to play their part in helping our planet amid the current climate change emergency should buy locally sourced products, such as Scotch Beef PGI and Scotch Lamb PGI, which have been reared to some of the highest and environmentally sustainable standards in the world.
If any Edinburgh University staff or students would like to visit a farm to better understand Scottish livestock production, please do not hesitate to contact Quality Meat Scotland (QMS).
We would be grateful if this letter could be shared with all students.
Yours faithfully,
Alan Clarke, Chief Executive, Quality Meat Scotland (QMS)
Professor Wayne Powell, Principal and Chief Executive, SRUC
Katie Dubarry, Vice President, SRUC Students Association
Sarah Whitelaw, Veterinary Student, Royal Dick School of Veterinary Studies
John McCulloch, HND Agriculture Student, SRUC Edinburgh Campus
James Withers, Chief Executive, Scotland Food & Drink
Alan Laidlaw, Chief Executive, Royal Highland and Agricultural Society of Scotland
Scott Walker, Chief Executive, NFU Scotland
Penny Montgomerie, Chief Executive, Scottish Association of Young Farmers Clubs
Sarah-Jane Laing, Chief Executive, Scottish Land and Estates
Andy McGowan, President, Scottish Association of Meat Wholesalers
Ken Fletcher, Editor, The Scottish Farmer
Katrina Barclay, Executive Officer, Royal Highland Education Trust
It’s time to bust the myths surrounding meat production and consumption with fact-based truth and a big dose of reality, a task for producers, processors and retailers that needs to be the top priority in 2020 if our industry is to have any sort of meaningful future, says the Scottish Association of Meat Wholesalers (SAMW).
“Scotland’s red meat industry is one of the jewels in the crown of the country’s hugely successful food and drink story and we need to make sure that 2020 is the year in which we fight back against the poorly-researched, factually ignorant and thinly-based myths advanced by those whose agenda is to demonise meat production and consumption,” said SAMW President, Andy McGowan.
Andy McGowan
“We have a strong and positive message to deliver on behalf of the natural grass-based livestock production systems on which the quality image of Scotland’s beef and lamb output is founded, alongside the impressive efficiency of our high health status pig industry. We need to unite as an industry in getting behind QMS to present this strong message to the nation’s increasingly confused consumers.
Position of strength
“Thankfully, we start from a position of strength in that consumers love our product. It’s the best starting point possible and one we need to keep in focus as we address the fake news stories posed by the anti-meat lobby. The recent BBC programme which focused on South America farming systems and US pork production was a prime example of poorly researched material being used to draw conclusions that attacked the meat industry.
“While consumers love our product, they are constantly made to feel guilty about choosing to eat meat, being regularly exposed to a mantra of anti-meat propaganda, dressed up as concern for a host of other issues. We’re perfectly content, in fact, to focus on life and farming within our own backyard and what happens here. Our story is solid and secure and made in Scotland for all to enjoy. This is the context in which we need to make sure the fact-based counter arguments to anti-meat propaganda are clearly and simply presented in 2020.
“I’m thinking of the sort of argument advanced recently by Benoit Cassart, speaking on behalf of UECBV, the European meat trade body, who pointed out that Europe’s ruminants are fed from ‘155 million hectares of permanent grassland that the European ecosystem enjoys’. He also stated that ‘one hectare of grassland is as effective as one hectare of forest in absorbing CO2 and maintaining biodiversity’.
“We only ever talk about agriculture’s greenhouse gas emissions, added Benoit, never about its enormous role in storing carbon through its production.
“He also drew attention to the many other contributions to society which can be traced back to ruminants. This includes their role in helping farmers to reduce their use of chemical fertilizers by maximising the livestock sector’s natural fertilizer to help restore essential microbial life to our soils.
Mr McGowan, speaking on behalf of member businesses whose commitment to the country’s red meat sector underpins trading activities worth £2 billion and the direct employment of 3000 workers, paid tribute to the many member companies who have continued to invest in new plant and equipment throughout the Brexit period, while also committing people and finance to international trade exhibitions, inward and outward trade missions and all other activities to promote Scotland’s red meat exports.
He also commented on the need for the industry to be fully equipped and properly supported by Government in the year ahead.
“Now that election outcome is known, we obviously need clarity concerning Brexit and the EU trade deal negotiations which will follow once the withdrawal agreement is approved,” he said. “Having already lived through three-and-a-half years of business upheaval and uncertainty, following the 2016 referendum result, we need the future path, whatever it is, to be progressed smoothly and fairly.
“In the midst of all the unknowns of the UK’s ‘Brexit and beyond’ era, we would urge the governments in both Scotland and the UK to back our industry at this time. We’re confident that we can continue to deliver strongly as an industry in 2020, placing top quality products in front of consumers in Scotland, the UK, the EU and wherever else the future takes our country. But we need our governments to give us their support in ensuring the move away from the EU CAP is organised smoothly to build on our key strengths as a nation that farms its livestock in a sustainable way, protects the rural environment and builds up its potential to produce top quality beef and lamb for meat lovers everywhere.
Four charities shared gift support totalling £10,000 from the Scottish Association of Meat Wholesalers (SAMW) this year, drawing on funds raised during a charity auction at the Association’s annual conference and dinner, held in Glasgow.
“We’re delighted to have been able to support four such worthy charities this year, thanks to the generous contributions made by our members and annual dinner guests,” said SAMW president, Andy McGowan. “This year’s charities were all endorsed by our executive committee, recognising some important links between the four charities we selected and individual members and our sponsors who have been supported by them in the past few years.
Left to right – Derek Malone; Dr Caroline Traa, Pans Panda UK; Billy Stewart, SAMW Vice President; Margo Wills, RSABI, & Raymond Adam, British Heart Foundation Scotland.
This year’s charities were:
British Heart Foundation Scotland (£4000)
This presentation was particularly special and poignant for all association members, being made in memory of Mike Malone, one of the founding fathers of our association and a long-standing member of our executive board. It was also deeply appreciated that Mike’s son Derek was able to take part in the presentation on behalf of the Malone family.
PANS PANDAS UK (£2000)
PANS PANDAS UK was established by a dedicated and determined group of parents with children who are affected by PANS or PANDAS. These are a set of conditions which result in inflammation of the brain, causing a variety of neuro-psychiatric conditions such as OCD, tics and eating disorders.
www.panspandasuk.org
RASBI (£2000)
The Royal Scottish Agricultural Benevolent Institution (RASBI), founded in 1897, provides financial and practical support and friendship to individuals and their families across a range of occupations with the common theme of working on the land in Scotland.
St Giles Hospice (£2000)
St Giles Hospice, founded in 1983, supports people whose illnesses may not be curable, such as cancer, motor neurone disease, heart failure, MS and respiratory disease. The charity also offers support for families and helpers.
The role of the processor
Unlike most food manufacturers, who assemble an end-product for the market from various raw or semi-processed materials, we start with a whole animal, giving us many different parts to prepare for sale to a wide range of diverse outlets. Some of the parts we handle attract good demand while others aren’t wanted at all (e.g. SRM, gut fill, bones etc). In between, we have other items that may be wanted by some but are subject to vastly differing levels of demand.
We have to balance the sale of all these products (demand cuts, non-demand cuts, commodity products and by-products) to deliver a gross margin that covers all costs and leaves a profit. In simple terms, carcase balance is about ensuring all costs are less than, or at worst equal, to our income.
Achieving carcase balance is the Holy Grail for all processors, large and small, as it enables a positive margin to be realised and keeps the business viable.
The following lists show both sides of the equation:
Business costs
Revenue streams
The key point concerning carcase balance is to get the required income from the mix of cuts across the carcase, plus the 5th Quarter. When all cuts are selling well, or have a ready outlet, then this is achievable, provided the total carcase cost is competitive in the marketplace (e.g. Scotch v English v Irish etc). The key cuts are Steaks / Grill / Frying, Roasts, Lean Mince, Standard Mince, Stew / Casserole, Flanks, 5th Qtr. When one or some cuts are not selling well, they have to be discounted (often substantially), or perhaps frozen (mince etc).
When processors need to freeze higher value primals, mainly due to lack of demand, the business concerned usually has to accept a significant loss of budgeted income. Even when mince is frozen and stored, some reduction in income is incurred due to product building up in store with no known customer in view at that point.
There are often times when some cuts don’t sell well, resulting in carcase balance becoming a problem (e.g. roasts not selling in summer, burgers not selling due to poor summer weather, steaks not selling well in the winter and stew not selling in summer, etc.)
In percentage terms, working with a bone-in carcase, roasts account for approx. 14% (53kgs from a 380kg carcase) and could result is a loss of up to £80 per carcase if discounting becomes necessary. Mincing material could account for approx. 42% (160kgs/380kg) and could easily be reduced by over £100/carcase if not selling well. Sirloin accounts for only 3.5% (13.3kgs/380kg) but could easily be reduced by £40/carcase in a slow market.
It is easy to see that if a processor does not get the cuts sold in balance every week, margin/profit can quickly erode. In addition, as most primal cuts are sold fresh (vac pac), processors only have a few weeks to act.
Furthermore, the total value of the 5th quarter can account for as much as 50% of the gross margin earned on a carcase. A drop in the value of hides of £20, or a poor trade for 5th quarter products (i.e. tongues, hearts or livers etc, destined for the Asian market) can have a huge impact on the prices that are required for other cuts, or the buying price of the original cattle.
The scope for demand and prices to fluctuate, due to a host of market pressures and volatility, demonstrates the huge challenge processors face in attaining carcase balance. If revenues do not at least match costs, then the business concerned can easily be placed in serious financial difficulty.
SAMW comment on transfer announcement by Food Standards Scotland
SAMW President, Andy McGowan, said: “We welcome the fact that FSS has made a clear decision on this issue and that everyone can now focus on how the official controls (OC) procedure is run rather than who runs it.
“Our principle concern has always focused on the need for member businesses to be provided with an OC service which is 100% effective and flexible with all inspection staff being deployed in the most efficient manner possible.
“The red meat processing sector already carries a heavy cost burden for meat inspections which many competitive food processors do not face. This puts us at a financial disadvantage which needs to be addressed by the Government, in terms of applying the same inspection rules and costs across all food processing areas, and by FSS, in terms of ensuring that the current procedure is run on the most cost-effective basis possible.
“We have repeatedly stated that any available vet and meat inspection resource which is found to be surplus to our fluctuating business needs should be made more nimble, allowing all under-deployed resource to be immediately reallocated to undertake public health inspection requirements in other food businesses and industries. The current inflexible and rigid system is an inefficient use of public funds, which we hope the new delivery structure will address.”
Click on transfer announcement in the heading to access the FSS statement
Scotland’s meat wholesalers have developed a four-point strategy, designed to reboot the country’s falling livestock numbers, along with a plea for Government action to be taken immediately rather than waiting for post-Brexit pilot trials to be run in 2022 or 2023.
“The latest figures show calf registrations down by another 2% and, if we wait until Brexit and transition is finished, we’ll have lost another 15% of our national livestock output,” said Andy McGowan, SAMW President.
“Building up the Highland each year is always a reminder of the quality of our livestock and the tremendous stockmanship skills available across Scotland. Unfortunately, what we command in quality we sadly lack in quantity, and we can’t go on merely celebrating the dying embers of our industry as each year passes.”
SAMW’s call for action includes the following strategy demands:
“We know the Scottish Government has set out its ambitions for the future of the rural economy in its Stability and Simplicity document, a plan which includes many sound proposals and objectives,” said Mr McGowan. “At the same time, however, the document lacks the urgency which our declining livestock numbers demand, if we’re to turn this industry around before it’s too late.
“A Government strategy of keeping things broadly the same until Brexit is settled and then running pilot schemes in 2022/23 to see what might work in the longer term is no good to us. We need these pilots to start now and for the demands of our four-point strategy to be addressed immediately.”
Demand one – Uplift in funding for beef calf producers
SAMW says: “The breeding sector is the cornerstone of the beef herd yet only receives £40m in public sector support via the suckler beef scheme, less than 1% of the total budget. This is inadequate and should be increased to £100m from 2019 onwards to provide a support payment of £250 for every beef calf produced.”
Demand two – Revamp the upland sheep support scheme
SAMW says: “With a current budget of around £8m, the impact of these support payments on an already fragile sector is modest. In addition, this same sector is about to be hit very hard as a consequence of the reduced value of LFASS payments in 2019 and 2020.”
Demand three – Extend Producer Organisations to all livestock sectors
SAMW says: “Producer Organisations have been instrumental in integrating and modernising the Scottish supply chains for fruit and vegetables. Extending this legislation to include the livestock sectors would be a cheap and highly effective way of driving supply chain efficiency for Scotch Beef, Scotch Lamb and Specially Selected Pork.”
Demand four – Simplify the Beef Efficiency Scheme
SAMW says: “While the Beef Efficiency Scheme (BES) injects welcome support into the breeding sector, participation in BES is dropping to a new low as many potential participants see it as overly prescriptive and bureaucratic. It needs to be simplified and focused on rewarding the key behaviours that deliver climate change gains and increase the overall efficiency and productivity of farming enterprises.”
Member companies should not be asked to pay more for official controls, SAMW President, Andy McGowan, told delegates at the Association’s annual conference in Glasgow on Saturday, April 27, 2019.
“The regulatory costs that have to be met by all of our member businesses are constantly being driven ever higher due to the onerous regulations we face and the manner in which these controls are enforced,” said Mr McGowan during his presidenial speech to the conference, addressing an audience which included Fergus Ewing, the Scottish Government’s Cabinet Secretary for the Rural Economy.
Andy McGowan
“Let me say clearly and firmly, that we have no problem whatsoever in observing the rules, regulations and standards that surround our industry. We believe in high health and high welfare standards and always have done.
“What we don’t believe in is inefficiency on the part of the regulatory authorities and/or the providers they hire, or the imposition of excessive costs on our members when more cost-effective solutions are available.
“In that context, we recognise that Food Standards Scotland faces a difficult decision with regard to the future delivery of official controls in Scotland’s red meat plants.
“The difficulties faced by the current service provider, HallMark, in retaining and recruiting good quality and highly competent staff is known to all. Indeed many of our members face the same dilemma.
“We are aware that FSS is currently in the midst of a review to establish what should be done to ensure continuity of delivery so that the statutory service levels are maintained.
“We’re also advised that regardless of the eventual outcome of this review, delivery costs will rise as it will cost more to hire in vets in the immediate future.
“However, the Scottish red meat sector is simply not in a position to absorb any extra costs, even if they were justified, which they are not.
“Under the current cost recovery model, which is barely a year old, we already pay over £40 per hour for a vet and £30+ for a meat inspector. That equates to an annual salary of £84k and £62k respectively.
“So, from the outside looking in, it does not appear to us that there should any problem in recruiting staff of the right calibre.
“It will therefore come as no surprise to anyone that our rock solid position is that the conclusion of this process must not result in any increase coming our way and could, with a little imagination and endeavour, actually bring these costs down.
“We are pleased that FSS is acting to prevent an unsatisfactory position from just rumbling on. Having said that, let me be clear that we have no particular preference as to whether or not official controls are provided by FFS direct, in the future, or via a private provider.
“Our one key requirement is for the official controls regime to be run on an efficient basis and that the service should be as cost-effective as possible.
“We have a clean slate here and therefore a rare chance for some fresh thinking. While all options need to be considered, I’d like to raise two specific points which our members strongly believe deserve to be given priority attention.
“First, there needs to be more equitable sharing of regulatory costs between the meat sector and other food producers, processors and manufacturers. After all we are all competing for the attention and custom of the consumer.
“In this context, it’s intriguing to highlight a report produced by the University of Leicester which established that bagged salad is the second most common source of food-borne illness. As recently as 2016 over 160 people fell ill in the UK from eating mixed salad leaves, with tragically two of those people affected actually dying as a result.
“Yet the salad industry pays nothing whatsoever towards the delivery of its regulatory controls.
“Incredibly it seems that both government and FSS believe that this particular part of the food supply chain does not need to pay for official controls which are supposed to be in place to protect the consumer.
“It’s the same with the production of alternative or non-meat food products. Businesses in these sectors also pay absolutely nothing for regulatory enforcement – and yet they operate in exactly the same market as we do.
“The regulatory costs picked up by fish processors aren’t much better, representing about 1/20th of the cost per kilo of the regulation charge that is applied to the meat industry.
“We are also competing with them for the same customers yet start with a commercial disadvantage. Its high time Government and FSS acted to ensure a level playing field exists for the recovery of official control costs in every part of the food supply chain.
“The second cost-effective point concerns the need for a more equitable sharing of staff costs between government agencies. I’m referring to the cost of providing OVs – the Official Veterinarians who monitor in-plant activities during operational hours.
“Our members accept that OVs must be paid for when they’re working but are deeply frustrated at also having to pay for periods of downtime when unavoidable delays or processing changes are required.
“There’s been a lot of discussion over recent years about using such OV downtime to meet regulatory control needs in other sectors. A simple example is that an FSS-employed OV, who is no longer needed to monitor a meat plant, could be redeployed to carry out animal health and welfare checks on farms and at markets on behalf of the Animal and Plant Health Agency.
“This sort of joint use of resources would allow the OV’s salary costs to be shared between FSS and APHA. But despite our prompting such an idea has never really got out of the starting blocks.
“In a country the size of Scotland, it should surely be possible for two government agencies to cooperate and share their staff resources more effectively to ensure the costs of delivery to the public purse and to the agri food industry are contained, to the benefit of all concerned.
“Thus far, it looks as if those in charge of such activities take the view that charging meat companies is simply easier than taking a hard look at practical and sensible options to putting a new and more cost-effective solutions in place.
“So, Cabinet Secretary, my concluding message is that we’re pretty set against any option that ends up costing us more money.”
T: 07768 654955 E: scott.walker@scconsultancy.uk
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