Earlier this year concerns were highlighted about the impact new EU country of origin labelling laws (COOL) for lamb, poultry and pork would have on the cross border trade of these commodities.
These laws now mean that in order to carry a country of origin label, e.g. United Kingdom, the lamb must be ‘reared and slaughtered’ in the UK. Given that a significant number of NI lambs are sold to ROI abattoirs there was concern about what would happen if the lambs were ‘reared NI, slaughtered Republic of Ireland.’
While this has caused technical difficulties at a processor level, such as segregation of NI lambs from ROI lambs prior to slaughter and labelling of the final product, overall this has certainly not stopped NI lambs travelling to ROI.
Between January and mid August 2014 approximately 200,000 were exported to ROI. During the same period in 2015 we have seen 175,000 lambs exported, representing a 12.5 per cent reduction on the year. The graph gives an indication of how exports fluctuate on a weekly basis. As far as the reduction in exports in 2015 is concerned, there are primarily three main reasons for this:
As the graph indicates, during April ’15 there was a notable reduction in exports and this came shortly after the introduction of the new labelling laws. The confusion around how these laws would affect market specifications and technical procedures in meat plants undoubtedly had an impact on trade. The Union would argue that this confusion in the market place was also used to drive negativety and downward pressure on prices.
Since the beginning of the year the euro has weakened by up to 11 per cent. Often the fluctuations have been unpredictable and largely driven by uncertainties around the Greek economy. This has not only affected live exports but has also meant that sheep meat exports from the UK have reduced by 20 per cent.
While overall sheep production in ROI has reduced, largely because of a 16 per cent reduction in ewe/ram culling, lamb production has actually increased by 1 per cent or approximately 15,000 lambs. This increase in the supply of ROI lambs may during some weeks be leading to weaker demand for NI lambs.
In the last three weeks we have seen live export trends which closely resemble those in 2014. With Bord Bia lamb promotion expected to intensify in the next few weeks as well as the Muslim festival of Eid taking place on the 24th September, it is hoped that demand for Northern Ireland lamb will be sustained.
ROI plants are heavily reliant on NI lambs for maintaining plant throughput and following discussions with the IFA in recent months, there is an acknowledgement that a weak export trade will envitably apply pressure on NI lamb prices which normally has a negative knock on effect on ROI prices.
A strong export trade, therefore is in the best interest of all sheep farmers both north and south of the border.