COMMENT: Sheep farmers will, no doubt, be concerned at Kepak’s intention to further streamline its lamb processing operations. This may well be construed by producers as yet further evidence of the sector’s ongoing disengagement from sheepmeat.
Recent years have seen a number of companies withdraw from lamb processing altogether with little or no outward sign of those companies that remain active within the sector, investing in ways that will allow them take up the slack.
At this stage it is worth highlighting the Harvest 2020 targets for the sheep sector. These stipulate that, in order to remain competitive, the industry should ensure that processing capacity in the sector matches producer output. Moreover, this should be a guiding objective both for any state intervention in the sector and for industry participants.
In addition, the processing sector, with the support of the relevant state agencies, must increase product and packaging innovation to increase the added value of sheep exports. And, finally, the sector should extend its product range, including the marketing of ‘local’ lamb to the domestic market, with support from the relevant state agencies.
It is significant that, courtesy of its statement on the future of the Hacketstown plant, Kepak point to a decreasing fall-off in lamb throughput and a growing inability to maintain costs as acceptable. Competition from New Zealand and the UK are also cited as contributory factors in this regard.
Given all of these background issues, is the time not right for those processors with a commitment to lambs to join forces and develop a single, state-of-the-art operation, capable of processing Ireland’s entire lamb output? Such an approach would, almost certainly, receive a friendly reception from Government, in terms of its commitment to the venture.
And, no doubt, a business plan could be put forward for the envisaged plant, based on its ability to deliver the improved efficiency levels required by the sheep industry moving forward.