Scottish beef and sheep producers are likely to feel the financial strain from 2012 long into next year as legacy costs from one of the worst winters in living memory continue to take their toll.
A Quality Meat Scotland report published yesterday, confirms the negative financial impact of the poor weather and increased costs.
The report, Cattle and Sheep Enterprise Profitability in Scotland, provides a snapshot of the 2012 calf and lamb crop year.
It is based on a survey of 70 breeding ewe, 115 suckler cow, 12 store lamb finishing and 51 cattle finishing enterprises.
All enterprises showed a decline in margins, with average cost of production lower – with the exception of cereal-based cattle finishing – than prices achieved at sale.
QMS head of economic services Stuart Ashworth said: “This report covers what was probably the most miserable summer, autumn and winter that many of us can remember.
“This will have a few legacy costs for the current year.”
Only 22% of suckler herds surveyed achieved a positive margin, compared with 30% the previous year.
Store cattle finishers fared better, with 59% reporting a positive margin, compared with 60% previously.
Sheep producers were worst hit. Only 19% of hill flocks achieved a positive margin – down from 57% previously.
For upland flocks, 47% saw positive margins compared with 100% previously, and in low ground flocks 83% reported positive margins, also down from 100%.
Store lamb finishers were also hit with only 50% reporting positive margins – down from 92% the year before.
The outlook for the 2013 calf and lamb crop was for increased margins so long as feed costs remained stable and producers experienced a mild winter, said Mr Ashworth. There were also signs of “green shoots” in the industry, as the evidence suggested that more female cattle were being retained on farms, which could help halt the decline in cattle numbers.