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by Sarah Millar, Quality Meat Scotland
04 June 2024
Associate Feature: How red meat sector could add £20m GVA to Scottish economy

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Associate Feature: How red meat sector could add £20m GVA to Scottish economy

Scotland’s red meat supply chain is already an economic powerhouse. It accounts for more than 36% of national farming output, employs about 39,000 people and has an estimated overall output of £2.8bn. Of this output, £0.8bn is GVA* (gross value added) - but there is easily potential to boost this by an a further £20m.

The key? Processing more of the cattle, sheep and pigs we produce within Scotland, retaining that value here in our Scottish businesses and within the Scottish economy.

Significant numbers of Scottish livestock move directly to other parts of the UK for slaughter. In 2021 the impact was;
● £65m of lost carcass output value and £10m of lost GVA for Scottish cattle; 
● £50m of lost output and £6m of lost GVA for Scottish pigs; and, 
● £35m of lost output and £5m of lost GVA for Scottish sheep. 

With these figures adding up to £150m in lost output and £21m in lost GVA, there is clearly an opportunity for Scotland to reclaim some, if not all, of this value. 

Capitalising on the £20m opportunity, and ensuring the full value of Scotch Beef, Scotch Lamb and Specially Selected Pork is captured in our economy depends upon retaining a strong network of processors and auction markets in Scotland.

However, Scotland’s declining livestock numbers are a concern, with breeding stock approaching their lowest population since 1973. Suckler cow numbers have fallen by more than 10% in the last six years against a backdrop of strong cattle prices and uncertainty about future support following exit from the EU. We are also ‘losing’ stock as English producers are increasingly buying Scottish cattle and sheep to finish as they, too, face a shortage. This loss of numbers is a risk to the critical mass of the Scottish processing sector; retaining more stock within Scotland is key.

Of course, processing more means selling more. About a quarter of abattoir output is sold within Scotland – most (68%) is sold in the rest of the UK and 7% is exported. We are accelerating our trade development work, aimed at attracting and retaining customers at home and abroad. 

We are already seeing significant export progress. Scottish processors secured more than £22m of new business at the recent Anuga food trade show in Germany, and we have also seen positive steps towards supplying Scotch Lamb to the Middle East, a market which imports about £571m-worth of sheep meat each year.

While we have a clear strategy and mission, the challenges are serious. Ensuring future political and economic support for our livestock sector supply chain – from fields and farms, to boosting our manufacturing competitiveness - is critical if we are to retain and grow the £2.8bn output from Scotland’s red meat sector. 

Our sector’s ambition is evident. Browns Food Group recently added significant manufacturing capacity to its Dumfriesshire pork processing plant; it aims to achieve £100 million in retail sales of Specially Selected Pork, create an additional 135 jobs and ensure sustainable on-farm production. ABP Food Group has just invested £24.5m in its Perth beef processing facility and created 80 new jobs as it develops further opportunities for Scottish red meat products in UK and export markets.

Examples such as this show there is no shortage of determination and belief in Scotland’s red meat sector – but we could achieve more, faster, with a more liberal business environment and continued support for our farming sector. We have the strategy to make us the choice for premium red meat and to build Scotland’s global reputation for sustainable red meat production. Retaining the additional £20m GVA in Scotland is only the start. 

*GVA – production incurs costs which must be deducted to determine value added. Gross Value Added (GVA) accounts for inputs such as animal feed, energy and veterinary services. It does not account for depreciation. 

This article is sponsored by Quality Meat Scotland

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