Examination of Witnesses (Questions 700
- 719)
TUESDAY 7 APRIL 1998
MR GEOFFREY
MOLLOY, DR
TONY HEANEY,
MR ANDREW
PRESTON, MR
EDDIE HONEYWELL
and MR PETER
KIRBY
Chairman
700. Before we move on to lamb, we have MLC
figures for last year which show 138 million tonnes of beef imported—we
have a list here and you have probably seen that—and most
of that seemed to come from the EU, but can you tell me what your
view is as to whether that has been used in the system?
(Mr Kirby) Most of the imported beef
at the moment coming into the country is used by the catering
trade, the big Whitbread's and so on, but they only import the
top end of the market, the sirloins and the rumps, the fillets,
but that is where most of the imported beef goes.
(Mr Honeywell) As far as our particular
industry is concerned, a lot of the own-label burgers come in
particularly from Ireland.
Mr Livsey
701. You say that all lamb processing is imported
from New Zealand because it "gives the best manufacturing
performance, most consistent quality and advantageous price",
but that your members would be happy to switch if UK supplies
could match New Zealand "in all aspects". Can you explain
in what way New Zealand lamb gives a better manufacturing performance?
(Mr Kirby) We use a considerable amount
of lamb coming in from New Zealand under contract. The lamb in
the UK is predominantly bred and supplied to the retail trade
only. The amount of lamb that is available in this country is
from a very short killing season and very few lambs are available,
other than to the retail trade. The sheer volume of lambs available
in New Zealand means that they can slaughter in a three to four-month
killing cycle and have enough lamb to supply Europe throughout
the year. In other words, they store and ship as the product is
needed. You cannot get the quantity, the quality and the price
that New Zealand can provide the UK and indeed Europe.
702. Is this not because the New Zealanders
are expert in freezing lamb and they kill the lambs at just the
right time in the season and, therefore, they can supply you with
a product which is consistent over a long period of time?
(Mr Kirby) Yes.
703. So would the British lamb producers really
have to enter this frozen market themselves in order to compete?
(Mr Honeywell)British lamb is supplied,
and I am not quite sure of the percentage, but, say, 88 per cent
as fresh product, not as frozen product and y ou have got to be
mindful of the fact that again we are taking by-products and the
prime cuts are going to where they get the best price which is
obviously in the chilled, so you cannot take the British market
and change it into frozen.
704. Yes, but given the timescale in which British
lamb is produced which, as you rightly say, is over a relatively
short period of time, it ought to be possible to freeze a proportion
of that lamb crop and sell it later in the year to compete with
New Zealand lamb.
(Mr Kirby) It is interesting that from
the 1st of this month, because of the lamb situation in the UK,
aid to private storage has been introduced, and the take-up by
the slaughter industry has been very, very poor indeed. There
just is not the return.
705. Is it though because there are not enough
freezing plants in Britain to actually tackle a job like this?
(Mr Kirby) I cannot truthfully answer
that. I am not sure what the answer is.
706. I understand that there are only three
capable of doing that actually and it is very low, so, therefore,
are you specifically specifying New Zealand lamb because it is
frozen?
(Mr Kirby) Yes.
707. Therefore, are you ignoring British lamb
because it is not frozen coming on to the market?
(Mr Kirby) Not ignoring it, but they
do not beat a path to our door at all. I am a purchasing officer
and I rely on people coming to me as well as me going to them
and I do not get the people beating a path to my door at all,
not to freeze lamb.
708. What is your specification as a company
for lamb?
(Mr Kirby) We purchase at the moment
from New Zealand.
709. And that is it?
(Mr Kirby) Yes. On cut, you mean?
710. Yes.
(Mr Kirby) Frozen lamb shoulders and
frozen lamb legs and flanks.
711. But are you specifying that?
(Mr Kirby) Yes.
712. In precisely the same way as the MoD will
not even supply a single lamb to British troops because they are
not frozen, and we are trying to do something about that at the
moment, so unless British producers can produce for you frozen
lamb to precisely the same specification as the New Zealand lamb,
you will not look at it? Is that right?
(Mr Kirby) Yes.
Mr Paterson
713. Are you also saying that the raw material,
if it was frozen in the UK in the same manner as New Zealand lamb
is frozen, would meet your specification, so is it the freezing
techniques that are wrong or is it the husbandry that is wrong?
(Mr Honeywell) It is not so much the
freezing technique, but at the moment it is the availability,
quantity and, I have to say, the quality because I can get some
and I do buy it whenever I can, but it tends to be at the end
of the season where it is a bit of an afterthought and not properly
done.
714. So the meat quality is not right and the
freezing technique is not right?
(Mr Honeywell) Correct.
Mr Livsey
715. The point I am making is that the lamb
quality by a certain age will be of excellent quality and if it
was frozen at that point, it might be a desirable purchase from
your point of view.
(Mr Honeywell) I think the issue is probably
getting complicated because when the butchers buy lamb or when
the supermarkets buy lamb, they want the loins, the legs and the
shoulders to sell and what we are buying in is to be processed,
so it is all dictated to by them and they have got to buy the
quality they want because that is where the bulk of the prices
come. We are buying at considerably less value and that is the
advantage of us dealing with New Zealand because they have the
market for the loins, the legs, shoulders, all of which take the
prime price and cover most of the price of the carcase and we
then take the by-product of that which over the years we have
developed to suit our specification and our operation, and if
you start it with us, you work on a by-product price and try to
fix a prime-cut price to the retailers for frozen meat which is
seen to be inferior to fresh for the retailers and to the housewife.
Mr Paterson
716. But given the fact that there is a by-product
from the prime cuts, are you saying that there is an opportunity
to improve the British product, to take it at the right moment
and to improve the freezing techniques?
(Mr Honeywell) Yes.
717. Or are you still saying that that product
is never going to be as good as New Zealand?
(Mr Kirby) I do not think that the amount
of product, the amount of livestock to satisfy the UK processing
industry, I do not think there are the sheer numbers about.
718. I am not suggesting that. I am just saying
that there is an opportunity to improve the sale price effectively
of the secondary cuts, the by-products, from the UK lamb industry
if someone got a grip on it.
(Mr Honeywell) If somebody was doing
it in the right quantity and doing it correctly, then we would
certainly not have the door closed to looking at it and buying
it.
(Mr Preston) I can only agree with my
colleagues. The biggest problem we have with Welsh lamb is who
offers us Welsh lamb? When was the last time you ever had a call
from anyone offering you Welsh or British lamb?
(Mr Kirby) Lamb, beef, pork, I cannot
remember.
(Mr Preston) Because there has always
been a market for lamb which has been retailed and that retail
market has always been at a higher price than we are prepared
to pay for the quality that we want, nobody has been interested
in offering meat to us.
Chairman
719. Am I right in saying then that it is also
the price issue and it is not just the quality issue?
(Mr Preston) It is always a price issue
because it is a price for a quality.
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