Mr. Jim O'Toole:

I thank members for the invitation to address the committee today. First, I acknowledge that the Irish sheepmeat sector has had a challenging year so far, driven by several factors, not least higher input costs and lower consumer demand due to overall food price inflation. In relation to carcass weight requirements, I emphasise to the committee that Bord Bia can speak to the market, customer and consumer requirements that we encounter and how these impact product needs, but as is understood, we have no commercial or trading remit.

Ireland currently exports 85% of the lamb produced here, with the largest majority of this destined for customers in mainland Europe and the UK. There is a small but growing proportion of Irish sheepmeat being exported to international markets. Lamb produced from carcasses within the desired weight ranges can be used to service the widest range of customer specifications in the marketplace. All current export markets have a strong preference for cuts of lamb from carcasses weighing between 18 kg and 21 kg. Carcass weight, along with conformation and fat cover, is also particularly important when lamb is being exported in carcass form. Until recently, the proportion of lamb being exported in carcass form had been in long term decline, with more value being achieved by reducing the carcass to individual cuts. The volume share of carcass exports was as low as 27% in 2019. However, this increased to 38% of all Irish lamb exports in 2022. Reduced lamb exports from the UK increased market demand for carcass lamb in key mainland Europe markets. The additional costs of processing and labour availability issues during and post Covid have also contributed to this trend. Also, over time there has been a growing consumer demand for lighter lambs and more versatile cuts arising from smaller household size and less time available for cooking, which has had a direct negative impact on demand for heavier carcass weights. This trend can be observed in the domestic and export markets.

Heavier carcases require a greater level of processing either at home or abroad. This adds to the costs, and the cuts of lamb produced tend to be of lower value as they are outside the preferred market specifications.

Meeting specifications in terms of specific cut sizes, unit costs and the aesthetics are also key factors when engaging with the retail sector in the home and export markets. These are all impacted by carcase weight, with those within the desired weight range best meeting requirements. Heavier lambs are more likely to be over-fat when processed. To meet the customer and consumer preferences, over-fat carcases need to be trimmed, which reduces meat yield and increases processing costs. Even after trimming, cuts from such carcases may still have a higher than desirable fat content and, consequently, are at risk of being less visually appealing to the consumer, which is a particular concern in an environment where lamb is seen as a high-cost protein.

Bord Bia’s focus is on supporting and enabling our producers so that customers around the globe recognise that Irish food and drink is world class, of high quality and distinctive, and our producers set the global standard in sustainable production and meet the responsibility we all have to the planet, to society and to future generations. I have previously stated to this committee, and am happy to reiterate, that our largest and most important stakeholders are Irish farmers. Ultimately, our goal is to help develop and grow the best and highest paying markets for our primary producers, which in turn can help them to deliver value.

In 2023, Bord Bia has committed a total spend of €3.5 million on sheepmeat sector development, including spending on market insights, consumer promotions and business-to-business marketing and communications. Bord Bia’s export market promotion of sheepmeat is primarily focused on the priority European markets of France, Germany, Belgium, Italy, Switzerland and the Nordic countries, although there has also been engagement in other markets where opportunities have arisen. Activities include partnerships with leading retailers to promote lamb, special activation events around St Patrick’s Day, print and digital media campaigns targeting consumers, and engagement with buyers through trade fairs and market study visits to Ireland. Outside of Ireland and Europe, Bord Bia continues to raise awareness of Ireland as a supplier of safe, high-quality, sustainable lamb through our EU co-funded multi-species campaigns. The current €4.78 million campaign launched in 2022 is active in South Korea, Japan, China and the US. Conscious of the need to increase lamb promotion with the younger consumer category in this challenging inflation-driven market, Bord Bia has focused a portion of its marketing on highlighting the health benefits of consuming Irish lamb and on highlighting the versatility and ease of preparation through social media platforms and recipe development.

Organic lamb production in Ireland accounts for 1% of overall lamb production. However, we expect and are preparing for this to grow substantially. Approximately 50% of current product is consumed on the domestic market, with the balance being exported, primarily to Germany, Belgium and the UK. We are acutely aware of the immediate challenge of product leakage in organic lamb due to seasonal supply. We are committed to identifying and capturing new potential customers for this and future supplies and we are actively assisting the sector.

I thank the committee for inviting Bord Bia to address it this evening. My colleagues and I are eager to respond to the questions of committee members. If we are unable to provide the required details, I assure them we will follow up with the individual members.