QMS survey shows significant rise in value of Scotland’s red meat and offal exports outside the UK to £137m

Data snapshot from QMS annual export survey (August 2023-July 2024):

• Total value of Scotland’s red meat and offal sold outside the UK reaches £137 million
• Exports have never previously exceeded £100 million, so the substantial growth marks a shift in business focus, as well as some impact from price inflation
• More than 95% of overall export revenues were generated in EU markets, climbing to 99% for Scotch Lamb
• Total sales of beef generated around £84 million for exporters – exports of Scotch Beef alone accounted for £43 million (51%) of this total
• Lamb export sales estimated to have surged to £45 million, accounting for an increased 31.5% share of abattoir turnover during this period (from 17% the previous year)
• Overseas sales of offal / fifth-quarter products continued to play an important role in balancing the carcase, contributing £8 million - 63% of this value was generated from EU markets

As Quality Meat Scotland (QMS) prepares for SIAL Paris—the world’s leading food and beverage trade fair—results from the QMS annual export survey reveal a remarkable rise in the total value of Scotland’s red meat and offal sold outside the UK to £137 million in the year from August 2023 to July 2024. Previous surveys have never recorded a value above £100 million and, while some of this growth will reflect price inflation, it also points to a greater focus on exports across Scotland’s red meat processing sector.

Iain Macdonald, QMS Market Intelligence Manager, commented: “Our enterprising companies are looking beyond the additional costs and complexities of trading with EU countries from outside the single market, seeking out opportunities which are more profitable than offered by the domestic market. Exporters are clearly taking advantage of tight EU beef and lamb markets, where demand for premium products is strong but local supply is declining.

“Export sales remain heavily dominated by EU countries and trade took place with sixteen of the twenty-seven member states. In fact, more than 95% of overall export revenues were generated in EU markets, climbing to 99% for Scotch Lamb.”

The survey also highlights that Scotland serviced twelve different non-EU markets. Switzerland remained a key outlet for high-value cuts of beef and lamb, while the majority of non-European countries primarily purchased fifth-quarter by-products such as beef tongue and lamb liver. Notably, multiple companies successfully shipped beef to Hong Kong, which tended to be at the lower end of the value scale, underpinning carcase balance.

With operating margins in the processing sector often as low as 2%, Iain added: “These markets are vital for generating additional revenue beyond what can be achieved in the home market, aiding in carcase balance and supporting the procurement of livestock from Scotland’s cattle, sheep, and pig producers.”

The QMS survey indicates that total sales of beef generated around £84 million for exporters. Exports of Scotch Beef alone accounted for £43 million, or 51% of this total, with the average value per tonne of Scotch Beef exported being approximately £2.10/kg higher than that of non-Scotch Beef. This premium partly reflects the balance of cuts being traded.

France, Italy, and The Netherlands remained the primary export destinations for Scotch Beef, collectively accounting for 75% of the total. Belgium and Germany also played significant roles, with Scotch Beef exports to these countries trading at well above average prices, indicating a greater focus on higher-value products.

Iain commented: “Furthermore, some smaller markets exhibited trade in high-value cuts, highlighting the opportunity for premium Scotch Beef sales to discerning buyers in a competitive global market.

“Cross-border value chains are also crucial in the red meat processing sector. While not included in the export figures, Scotland’s processing companies reported shipments of beef to Northern Ireland, reflecting movements to specialist cutting and packing sites, with the meat then returning to Scotland for retail. Additionally, some beef sold to wholesalers in England is further processed into specific cuts and exported from their specialist production sites.

“With EU demand for lamb remaining firm and production decreasing, Scottish processors capitalised on this opportunity, with export sales surging to £45 million. Lamb exports accounted for an increased 31.5% share of abattoir turnover during this period, up from 17% the previous year. Beef sales are estimated to have reached 11% of turnover, up from 9.5% a year earlier. France remained the most important overseas market for Scotch Lamb, followed by Germany and Belgium.”

Finally, sales of offal to overseas customers continued to play a crucial role in maintaining carcase balance for Scotland’s red meat processors, generating £8m of sales. Notably, 63% of this value was generated from EU markets, with average prices slightly higher than those from non-EU destinations. France, Germany, and Hong Kong were the primary outlets for Scottish offal.

Tom Gibson, Director of Business Development at Quality Meat Scotland, commented: “These results highlight the resilience of our red meat sector and the continued strength of our relationships with European importers. Despite the ongoing challenges posed by Brexit, our exporters have adapted and thrived, demonstrating the premium quality of Scotch Beef and Scotch Lamb.

“SIAL Paris is a critical platform for us to showcase the exceptional quality of Scotland’s red meat industry to a global audience. It provides an invaluable opportunity to strengthen existing partnerships and forge new connections that will further enhance Scotland’s presence in international markets and promote Scotland as the choice for premium red meat.”

SIAL Paris will take place from 15 to 19 October 2024. Follow @qmscotland on social for live coverage of SIAL.