NEWSFLASH Animal By-Product Derived Products Market Conditions Update Potential Impact of Brexit No Deal Scenario - UPDATE

In our July 2019 Newsflash we alerted our stakeholders of potentially significant disruption to EU market access for processed animal protein (PAP) and tallow in a No Deal scenario.

Since then we have been in frequent dialogue with DEFRA and other Gov UK representatives to understand the scale and potential wider impact of these issues and to investigate potential contingencies to mitigate the impact on renderers and the meat supply chain.

Last month we held a well-attended workshop with our meat industry stakeholders to explain the intricacies of the 3rd country export health certificate rules for these products, potential contingencies and estimated worst-case impacts on our EU exports.

An economic impact assessment of restricted EU markets for rendered products is being undertaken and we have shared the FABRA UK statistics with DEFRA and AHDB for independent scrutiny. AHDB are working with DEFRA to look at the wider impacts on the meat industry.

In the last week we have met with George Eustice MP, Minister of State at the Department for Environment, Food and Rural Affairs (Defra). Mr Eustice understands the importance of our industry to the meat supply chain and biosecurity and Gov UK has included our industry’s issues in their high priority issues list to address under No Deal.

We continue to look at the practical contingencies to prevent and minimise disruption to our operations and hope to be able to remain operational and maintain our service levels to the meat industry. However, lower rendered products revenue is still a concern and any deficit would need to be balanced somehow.

Depending on the Brexit outcome, this could mean changes to the collection and pricing strategies for animal by product raw material. The need for and severity of any price changes is dependent on the rendered product markets which are very fluid and on the potential level of support Gov UK is able to provide to the meat industry.

While these uncertain market conditions prevail FABRA UK may issue further bulletins and updates. Please also check our website (www.fabrauk.co.uk) for further updates.

Contact Us:

If you would like to know more about this news or FABRA UK, please contact Nikki Robertson Tel: +44(0)7584 022909
Email: nrobertson@fabrauk.co.uk

NEWSFLASH Animal By-Product Derived Products Market Conditions Update Potential Impact of Brexit No Deal Scenario July 2019

FABRA UK represents over 90% of the UK animal by product processing industry and engages and negotiates with key industry groups and other interested parties.

Over the last couple of years, we have been in discussion with Gov UK representatives from DEFRA, its Agencies and devolved Governments to prepare for potential Brexit scenarios. In the last few weeks the discussions on No Deal implications have intensified considerably as this seems more likely than ever and the UK’s EU departure date of 31st October 2019 is approaching fast.

On behalf of our members we are alerting our key stakeholders of potentially significant disruption to access into European markets for processed animal protein (PAP) and tallow. 

We are looking into practical contingencies to prevent and minimise disruption to our operations. However, we also need Gov UK to assist with solutions to address the EU import conditions that will apply to the UK as a third country under No Deal and on opening export markets for our products to other third countries.

If these issues cannot be resolved or mitigated there may be a significant fall in UK PAP and tallow prices and potential disruption to our collections of ABPs from the meat industry.

We are alerting our customers and industry stakeholders of these potential market conditions to give them advanced warning that our members may be forced to review their collection and pricing strategies for animal by product raw material. This is an industry wide issue and is not limited to individual animal by product processors.

We ask our stakeholders to pass on this information to their colleagues and members in their relevant sectors and lobby UK Gov for support in keeping the meat supply chain open for business.

 While these uncertain market conditions prevail FABRA UK may issue further bulletins and updates. Please also check our website (www.fabrauk.co.uk) for further updates.

ABP Derived Products - Market Conditions Update

FABRA UK represents more than 90% of the UK animal by product processing industry and engage and negotiate with key industry groups and other interested parties. 

On behalf of our members we are alerting our key stakeholders of major movements in the European market for processed animal protein (PPAP) and tallow:

Our members and our colleagues at the European Fat Processors & Rendering Association (EFPRA) have advised us that there is currently no European export market for PAP due to trading conditions in many of the Asian markets. Substantial stock piles of PAP are already accumulating as there is insufficient demand for this material in Europe to meet supply. Consequently, there has been a significant fall in PAP prices in recent weeks which is seriously impacting on the UK market for this commodity.

To compound this issue, we have also seen a sizeable reduction in the value of tallow, partly because of the EU reducing import duties for tallow from certain Countries. 

We are alerting our meat industry stakeholders of these changing market conditions to give them advanced warning that our members may be forced to review their pricing strategies for animal by product raw material. This is an industry wide issue and is not limited to individual animal by product processors.

We ask our stakeholders to pass on this information to their colleagues and members in their relevant sectors. Whilst these uncertain market conditions prevail FABRA UK may issue further bulletins and updates. Please check the News section of our website for further updates.

To download a PDF copy of this Newsflash - please click HERE.