It's a long time away, but the latest medium term outlook figures up to 2030 reveal a mixed picture for individual farming sectors with the future of the sheep industry looking more optimistic than most, for once

The figures from an EU report show that while global meat consumption is expected to increase by 14% between 2017 and 2030, most of growth is predicted to be exported as EU meat consumption appears to be plateauing. Even so, 90% of total EU meat production will go to EU consumers with rises in global consumption mainly satisfied by domestic production.

According to the report, beef production stabilised in 2017 following the restructuring of the dairy sector and the decline in the sucker herd in 2014-16. However, beef production is forecast to drop to 7.5mn tonnes by 2030 due to a reduction in herd numbers, although an increase in EU average carcase weights is anticipated.

Overall, the suckler cow herd in the EU-15 is expected to fall 10% to around 10.3m head by 2030, while a 12% increase is projected for the EU-N13 suckler cow herd, to 1.1m head, highlighting the significant differences between individual member states forecast.

On a more positive note, production of sheep and goat meat, is expected to grow by 4% by 2030, following a period of long term decline. Sheep and goat meat are also projected to increase their share of per capita meat consumption, contrary to the trend witnessed in the previous decade. Forecast projects consumption at 2.0kg per capita (retail weight) in 2030, with total consumption increasing slowly to around 1.2m tonnes which can only be good news for Scottish sheep farmers.

Production of sheep meat in the EU is expected to stabilise at around 1m tonnes, however there will be huge variation between member states, with gains thought to be driven by improved profitability, increased demand for live animals, and the implementation of voluntary coupled support. The report claims the EU sheep and goat herd will increase in the first half of the outlook period before declining slightly towards 2030 to around 102m head.

While sheep imports from Australia and New Zealand were 18% down on the year in the first seven months of 2017, due to the severe droughts down under, imports are expected to remain within TRQ levels until 2030, although increasing over time.

Despite favourable feed prices, pig meat production is expected to expand only marginally by 2030, due to stabilising EU consumption and competition on the world market.

There is a mixed outlook for the poultry sector too as while production of chickens for meat is expected to rise by around 5% between now and 2030, driven by promising growth in world import demand and domestic consumption, prices will be under pressure and stay below levels seen in 2011-2015, due to increased competition on the world market.

Looking at the dairy sector, the EU report believes growing global and EU demand will support world dairy markets in the long term. However, price variability will continue and short-term market inbalances are expected.

Global trade in whole milk powder, skimmed milk powder, cheese and butter is expected to grow on average by 1m tonnes of milk equivalent per year, which is significantly below the average growth witnessed for almost all products in the past decade.

The one exception is butter for which trade will expand faster than in the last decade, with China remaining the world’s leading importer of dairy products. As a result, shipments to China are expected to increase considerably, albeit by less than in the past.

The report claims the EU will supply 30% of the increase in world import demand for whole milk powder, skimmed milk powder, cheese and butter. Including whey powder and fresh dairy products, EU exports are expected to grow on average by around 500,000t of milk equivalent per year, mainly in cheese and skimmed milk powder.

Looking at the arable sector, EU cereal production is expected to grow further to 341m tonnes by 2030, driven by feed demand, good export prospects (in particular for wheat) and increasing use of cereals in industry.

However, stronger growth will be held back by the limited potential for expanding the areas under cultivation and by slower yield growth in the EU than in other regions of the world. Cereals stocks are expected to stabilise below historical levels, in particular for wheat and barley. Prices are expected to recover from their current lows to above €170/ton average and at close to €194/t for common wheat at the end of the period. The report did nevertheless point out that price spikes are possible during the outlook period caused by climate events, particularly if these occur in successive years

* Since the negotiations on the UK’s exit from the EU are ongoing, the projections are made on basis of a European Union of 28 Member States, ie including the UK, for the full duration of the outlook period