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processed’ meat and meat products. These two market segments could also be categorised as ‘leisure’
and ‘convenience’ markets.
• The ieisure’ market for meat, is that for fresh or lightly processed meat -which requires
some time or effort for cooking (at home or catering), and increasingly where purchasers
will seek a more advanced state of preparation. Consumers will also expect that all
attributes of quality (eating experience - taste, efficacy and consistency) will be included in
the offering. With these products price is less of an issue. They will also be judged by the
extent to which they meet consumers’ concems on some of the ‘macro’ issues, such as
animal welfare and the environment.
• The ‘convenience’ market for meat is essentially processed meat products with a high
convenience element, were ‘quality’ is largely built in by the processors, who will seek
competitively priced raw materials.
This highlights some particular problems for the sheep sector in the context of these markets. The
impact on the lamb sector of the developing ‘convenience’ market, will be that sheepmeat will
continue to be a minority component of convenience meat products until there is a major breakthrough
in deriving from sheep carcasses low cost lean tissue with a low content of fat with modified fatty acid
composition to production will be:
• mainly targeted at the ieisure’ market
• that concems about production methods and efficacy assurances will be dominant
• that traditionally produced ‘extensive lamb’ will have difficulty in competing as raw
materials forproducts forthe ‘convenience’ market.
However with lamb derived fforn large commercial producers the processors need to exploit the whole
carcass and utilise the ‘residual’ product i. left after the ‘cuttings and trimmings’ from the ‘high
quality’ hindquarter and to better exploit the forequarter. This will lead to some ‘convenience
rnarket’ opportunities.
2. Changes to Support Regimes
Agenda 2000
The Agenda 2000 reform measures were more favourable to cattle production and provide some
disincentives for sheep. The regime is due to run to 2006 but, with events having been overtaken by
the continental BSE crisis , a number of changes could be made to the beef support mechanism.
Indeed, a ‘mid-term’ review of the efficiency of the reforms was promised for 2002/2003 and
measures being discussed with a view to countering the effects of the continental BSE crisis, could
result in alterations to support mechanisms in the beef sector in the short-term. Despite the fact that so
far the UK has escaped the worst effects of the latest BSE crisis, any changes made to support
mechanisms would apply to the whole of the EU. Prior to the FMD crisis the EU had unveiled a
series of ‘7’ proposals (the Fischler 7 Point Plan) all aimed at reducing beef production from 2002 (to
counter the 10% decline in EU consumption that is expected in 2001). The EU is keen to prevent the
build up of beef stocks and these proposals were aimed at rebalancing the market in the medium term,
mainly by encouraging less intensive beef production (with boosts for organic farming and a reduction
m stocking densities).
Change in Hill Farm Support
A large percentage of farmland in the UK is defined as being in a LFA (mainly hill and upland). In
England and Wales for example some 2.3 million hectares or 22% of agricultural land are in the LFA.
Livestock producers in these areas will have been receiving Hill Livestock Compensatory Allowance
headage payments on ewes and suckler cows for a number of years. Total direct subsidies have
represented between three and four times the level of net farm income on cattle and sheep farms in
English LFAs, with almost 35% derived from specific hill subsidies, such as HLCA payments
(MAFF, 2001) and the situation is similar in other parts of the UK. Other support is available from
Payments under the Environmentally Sensitive Areas, the Countryside Stewardship and the Organic
Conversion schemes, plus a range of training, adaptation and diversification measures.
Things changed radically in 2001 when hill farm support switched away from livestock numbers to
area payments. In the short term the rules of the new scheme ensured individual farmers do not lose
°ut in terms of subsidies received compared with those received under the old scheme. It is unclear as
t0 the precise effects that the new LFA support scheme will have on future subsidy receipts, but in