Examination of Witnesses (Questions 940
- 961)
TUESDAY 21 APRIL 1998
MR MIKE
GRIMWOOD and MR
VINCE CRAIG
940. They would not perhaps because if they
did they would be cutting their own nose off to spite their face?
(Mr Grimwood) Indeed. At the time we
did not go into whether they would or they could, and we generally
agreed that we bought something different from that which they
grew.
Ms Lawrence
941. It does seem odd if you are producing a
lean animal that you get lean hindquarters and you do not get
lean forequarters? Has any attempt been made to investigate, from
your point of view?
(Mr Craig) It is interesting. I actually
asked a very similar question when we were sitting down with our
meat buyers, our buyers in general, and the answer that came back
was, "We have not been approached to supply that type of
material for the last couple of years." I think the recognition,
to go back to Mr Paterson's question, is that there is a price
differential and that the marketplace recognises that through
the Uruguay Round in 1993 people realised that there are two different
marketplaces and this is going to be a difficult marketplace to
get into to supply the quality at the price that is available
for us as a manufacturer.
942. What do you mean "two different marketplaces"?
(Mr Craig) In that you are talking in
terms of trying to supply fresh meat in the United Kingdom marketplace
with the costs that are involved in this in comparison with the
costs that are involved in, for example, Uruguay and Argentina,
beef that is grown naturally basically on the pampas and with
all the manufacturing and processing cost benefits at very large
abattoirs. I think that is the difficulty. I think the difficulty
is going to be to see how the UK farmer can compete.
943. Which will be difficult?
(Mr Craig) I think it is quite difficult.
I think, however, it depends on the price point of the finished
product, the meat content of the finished product and whether
the products can carry the additional cost. We have seen, to be
fair, because we have been working with both retailers and farmers
in the last six months, that there are products that can carry
the differential, and we have seen an increased use, as we agreed
with the Welsh farmers we would increase the use and we have done
so, but in some products it is going to be very difficult. With
some of the more standard single portion ready meals it is very
difficult.
944. Give me an example of a popular single
portion ready meal?
(Mr Grimwood) Cottage pie.
(Mr Craig) Or lasagna.
Ms Morgan
945. In your appendix on the chilled food market
you anticipate that this will continue at a rapid rate. Are there
going to be opportunities there for UK producers?
(Mr Grimwood) Yes, indeed, and you will
see that one of the reasons for our increased usage of UK meats
over recent months has been, as was mentioned earlier on, that
we continually develop and innovate new products as we have brought
new products to market and as we have gone into different markets
within the overall chilled food area and that has borne opportunities
and that could continue.
Mr Thomas
946. Could we get on to the question of labelling.
As you appreciate, that is something which has exercised this
inquiry for some time. Are your meat products labelled by country
of origin?
(Mr Craig) Our meat products are labelled
by country of point of manufacture. I should also say that we
do not actually label. We are not responsible for labelling.
947. Because you are selling almost exclusively
to—
(Mr Craig) In excess of, in round figures,
95 per cent.
948. So it is out of your control basically?
(Mr Craig) Yes. We supply all the information
that is there. The very detailed specification will detail all
the ingredients, where they come from, etc. and the retailer will
take a decision, but I think it is also fair to say that obviously
something like a beef lasagna, a standard 300g beef lasagna, typically
contains perhaps 10 or 12 per cent. meat content. The meat would
not necessarily be the biggest component in a ready meal. It would
probably be more pasta, for example, and there might well be more
dairy component from the bechamel sauce.
949. As a matter of interest, would you provide
details of the source of origin of the meat to the customer in
any event? In that example, for instance, do you tell the customer
where the meat came from?
(Mr Craig) We do not currently.
(Mr Grimwood) We would have within specifications.
(Mr Craig) Sorry, do you mean the customer
or the consumer?
950. I am talking about your customer.
(Mr Craig) Within our customer, yes,
100 per cent.
951. They will be told where the meat comes
from?
(Mr Craig) Indeed, yes, 100 per cent.
952. Do you think your products might become
even more successful, even more popular than they currently are,
if you are able to tap into perhaps a desire by British consumers
to buy British beef or British meat products?
(Mr Grimwood) If marketed properly, yes,
and if I can give the example of the fish pack we have, two of
our most successful lines are Scottish haddock and Scottish cod
and it is a very good example of a part of the country that has
really got its act together in telling everybody how wonderful
Scottish fish is, and they are very successful lines.
953. Purely as a matter of interest, Mr Chairman,
if you will allow me two very short questions, have you done anything
to try and market things like mussels, seafood?
(Mr Grimwood) Mussels from UK waters
would be—I will now get into "techno-speak", which
is very dangerous. Generally, we did some work with mussels about
two years ago and there were only two points in Europe where we
could purchase on health grounds for the retailers. One was Denmark
and one was Holland. We certainly were not buying mussels off
Anglesey.
954. Why not?
(Mr Grimwood) Because the water was too
dirty and they were contaminated.
955. What about laver bread, purely as a matter
of interest?
(Mr Grimwood) Not even tried it!
Chairman
956. May I ask you what I have asked our other
witnesses. What, in your view, can be done to ameliorate the current
crisis in the livestock industry?
(Mr Grimwood) As a serious point, then
establishing something that says that Welsh lamb or beef or British
lamb or beef is of a superior nature and marketing it properly
is certainly something that would help the industry. I remember
back to times when UK meat was best and people genuinely believed
that.
(Mr Craig) The other thing I would strongly
suggest is that the plugs have to be targeted at the premium end
of the marketplace so that they can actually carry the additional
costs that are involved, and trying to target the cheapest ready
meal on the market is almost guaranteed to fail. Premium products:
as long as the product delivers to the consumer benefit, people
will pay for good quality.
(Mr Grimwood) Also, I made a note earlier
on of Mr Thomas's point about whether they could or whether they
would grow cattle to what we require, almost something like a
clearing-house of needs. I am sure farmers do not really appreciate
what we require and we have little understanding of what they
can and cannot do and perhaps that would clarify the point.
Mr Thomas: That is an interesting point.
Chairman
957. One of the features of all the on-costs
that you have outlined and our previous witnesses have outlined
is, of course, that they are there. Our biggest source in this
country is the safest probably in the world now and I would have
thought there was possibly some marketing benefit in that from
the safety point of view?
(Mr Craig) I think there is a benefit
in that, for sure, but I would equally suggest that there are
a number of other countries in the world who would claim very
high standards and I think we need to recognise that and that
the safety standards of the raw materials need to be over. Almost
that is taken as read. If you are going to sell to a UK consumer,
the UK consumer expects the product to be safe. That is standard.
Above that it is the quality of the eat of the meal that is going
to be the deciding factor.
958. I am thinking not just about BSE but things
like steroids?
(Mr Craig) I was not thinking about BSE
either. I think it is the whole range of agro-chemicals, microbiology,
safety, BSE and whatever next is in the pipeline for the food
industry to struggle with.
Ms Lawrence
959. I was going to ask if you feel that there
is room for improvement in the communication between producers,
what they use, and yourselves?
(Mr Craig) Yes, hugely.
960. It strikes me from what you say that it
is minimal and that it could be expanded to everybody's advantage?
(Mr Craig) It is and I think there is
a lot of room for improvement in that area. What I would strongly
recommend is that if this area is going to develop it needs to
be done at a practical level and not a talking shop level. It
needs to be farmers and producers, not people who are not directly
involved.
961. One of the other areas of evidence given
was that someone said they had been along to a farm and seen a
live animal. It was the deadweight/liveweight scheme, where animals
were seen by farmers and judged to be in prime condition and then
the same farmers afterwards who produced those animals saw the
dead carcases and could not believe the difference. It just seems
that there is a massive lack of understanding there between the
producer and the manufacturer as to what is actually required
to get the best out of the whole system.
(Mr Craig) In our situation, the stage
further forward than that, in that the carcase is broken down
into a 25 kilo box of very lean meat. That is another stage forward
for people to recognise what our requirements are. We certainly
found it useful when we were discussing with the Welsh farmers.
It started off as an interesting way of spending the evening for
Mike but we learnt a lot from it as well.
(Mr Grimwood) And we were quite happy
to show them the plant, what we did, and so we had two or three
constructive days talking about what we all did, and I think both
sides of the equation were suitably enlightened.
Chairman: Could I say we are more enlightened
by your presence here today. Thank you very much indeed.
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