The chair of the NI Food and Drink Association (NIFDA), Declan Billington, has called on local politicians to get on with restoring the institutions at Stormont, pointing out that Brexit could yet turn into an opportunity for the NI agri-food industry.

“With the right people making the right arguments at the right time, I see no reason why we can’t turn this around to work for us,” he told delegates at last week’s conference organised by the Poultry Industry Education Trust.

However, he also gave a stark warning that if the wrong decisions are taken, it would be devastating for the NI agri-food industry. That nightmare scenario is where the UK falls out of the EU in March 2019 without a trade deal, meaning that WTO tariffs would apply on imports and exports, including across this island. But given that the tariff rates are the maximum that can be applied, the British government could decide to import at much lower, or zero rates, to keep the price of food down. “There is no way on earth the UK government will deliver a Brexit that brings food inflation,” said Billington.

If operating under WTO rules, the UK would have to treat everyone the same, so it would leave the likes of Irish beef competing directly in the British market with a much cheaper offering from south America.

“The Irish can’t compete; European countries can’t compete. Our supply chains would shift dramatically. If we do get this wrong, it will be a big problem in every town and village in NI. The dole cheques will be bigger than the savings in the shopping basket,” claimed the NIFDA chair.

He was also critical of those in government who sometimes cite Singapore as a model to follow, given that it operates a liberal trade policy, with minimal tariffs on imports. The difference between it and the UK, is that Singapore is basically a city state without a farming industry to protect, said Billington.

So how can Brexit be turned into an opportunity? Billington points to the large deficit in UK food self-sufficiency, in particular, across the likes of poultrymeat, beef, dairy, pork and eggs, and also major British supermarkets concerned about the future, and keen to lock in a UK supply chain.

To maximise that opportunity, it is important that the industry isn’t undercut by cheap food imports from outside the EU, and also has access to EU and non-EU markets to sell products (eg offal) that UK consumers don’t want to eat.

“We tell policymakers in Defra and ministers in government that to fill the gap in the home market we also need to increase exports for carcase balance. It is a bit of a surprise to them – a light bulb moment,” said Billington.

In NI, he maintained that we must press ahead with a new marketing body to promote food from here.

On the issue of the border in Ireland, Billington points out that under the Good Friday Agreement, animal and plant disease is managed on an all-island basis, so there is an argument that goods originating in NI should be allowed tariff-free access to the EU market.

“We can control the border in a factory. We already have the technologies and systems in place. This doesn’t need to be over-complicated,” concluded Billington.

Poultry overtakes pork as most consumed meat

Poultry is on track to overtake pork, and become the world’s most consumed meat.

Exploring future trends, Australia-based Gary Millar from poultry breeding company Hubbard, outlined how the broiler sector in Asia is catching up with European counterparts, with a move away from small, backyard operations, to new specialist sites, focused on efficiency, biosecurity, improved animal welfare and reduced use of antibiotics.

With genetics continuing to advance, he predicted that fast growing white birds will get ever closer to a feed conversion ratio of 1:1 (1kg of feed for 1kg of liveweight gain), and that the industry could achieve 25 days from hatching to slaughter in the future.

“That creates a general management challenge, as there is less and less room for error. By 2020, 40% of a bird’s life could be inside an egg,” he said. He also maintained that in western Europe the trend (driven by the animal welfare lobby) will continue towards more general diversification in production, with increasing numbers of birds reared in free range systems, and more use made of slower-growing birds.

Good practice crucial to threat of avian influenza

While the risk of infection from avian influenza (AI) on individual poultry units is currently classed as low, the risk status of the disease coming to the UK via wild birds has recently been raised to medium.

Speaking at the poultry conference last week Professor Ian Brown, the head of virology at the UK Animal and Plant Health Agency encouraged the industry in NI to maintain a high level of biosecurity this winter and keep surveillance under review. “Early detection of the virus is vital. You were very lucky last year that AI was only found in wild birds. Not many EU member states could say that,” he pointed out.

The main issue at present is in Italy, where outbreaks have been on-going since July, and preventative culling of poultry is in place. There have also been other outbreaks across Europe since the summer. To date, it is the same H5N8 strain of AI as found in the UK last winter.

Less active

If this strain returns to the UK this winter, it might be less active, given that a certain level of immunity could have developed. However, Professor Brown points out that other strains of the virus are entrenched in Asia, some of which are a risk to humans.

He believes, that in the longer term, the UK should look at developing vaccines. “It isn’t an easy win, but we need to develop a vaccine now to use in two years’ time. We need to invest in research to develop the right vaccines,” he said.

Know what your market wants

Different consumers want different things from food, so it is important to know what segment of the market you are targeting with your products, maintained Professor Geoff Simmons from Queen’s University Belfast.

In general, growth in poultry consumption has been due to wide availability, low prices and the higher versatility on offer. But for millennials (people born between 1982 and 2002), they are increasingly driven by concerns around their health, animal welfare and the environment. They perceive poultry to be healthier to eat. They also have poor cooking skills, so go for poultry over red meat.

Within this group, there is also a new segment called flexitarianism, who are vegetarians most of the week, and only eat meat on special occasions. “It is a key trend now and beyond. Their motives are increasingly popular,” said Simmons.

Separate to the millennials are the boomers (people over 55) who have a high disposable income, will pay for quality, local food, but also want a healthy diet.

Currency factor in grain prices

Grain markets are well supplied at present, and unless there is a major weather event in a grain producing region, there is no reason to believe significant price increases will occur, maintained Philip Lynch, a trader with R&H Hall.

However, part of the reason why stocks remain high is that better crop production techniques in the likes of Russia, Ukraine and Brazil are making crops more resilient to adverse weather said Lynch.

In addition, while prices in US dollars might be low, favourable currency exchange rates in the likes of Russia and Brazil mean that farmers there are profitable, and continue to plant new crops.

Currency

For farmers in NI, currency is working in the other direction, given that sterling has weakened significantly against the US dollar since the vote to leave the EU.

In terms of soya bean, there are three main suppliers (Brazil, the US and Argentina), and while the market is well supplied at present, it is very sensitive to a weather threat said Lynch. “There is still some volatility in the market, but it is still difficult to see any rally in price at the moment. A decision (by a local feed miller) to extend cover will be driven by a view of the current position of sterling,” he concluded.