THERE can be no disputing the financial difficulties felt in all sectors of the industry throughout most of last year and sadly, 2016 looks set to yield much of the same.
While prime cattle, sheep and pig values have improved slightly in recent weeks, only lamb prices are ahead of those achieved last year, and according to Quality Meat Scotland’s chief economist, Stuart Ashworth, even these are likely to fall as the seasonal increase in numbers come on board.
Adding fuel to the fire of an already lacklustre market, he said increased supplies of beef and pork are also likely to be available this year, dampening down prices, due to the rise in calf registrations throughout 2015 and growth of the Scottish sow herd. 
Combine those facts with a relatively unchanged sheep flock, current flat consumer demand and exchange rate challenges following the EU Referendum, and Mr Ashworth said producers face even more difficulties this year.
“It is going to be another tough year for producers and going by the last few months, market prices are not going to increase significantly to save margins,” said Mr Ashworth, who instead, encouraged farmers to improve their levels of efficiency.
“There is still lots of evidence to show there is capacity in the industry to improve efficiency, whether that be in grassland, crop or animal performance, or nibbling away at costs of production.”
Looking at the beef sector, Mr Ashworth said there will be an 8% increase in the number of cattle in the pool that abattoirs can draw from over the next 12-18months, hence producing cattle with the correct finish and within the weight range demanded, will be key to maximising end prices.
“The fact that heavier carcase weights will be penalised this season has been flagged up early enough that producers can adapt their management regimes to produce lighter weight carcases to the spec demanded,” he said.
Sheep, Mr Ashworth said, always enjoy a good trade just before and at the end Ramadan which this year comes to a close at the end of the first week in July with the traditional muslim festival. How trade progresses after that, depends on how supplies are delivered to the market. But, with a stable breeding flock and little change in the overall lamb crop, July and August, he said July and August are again likely to see the biggest numbers forward.
Demand from the continent, as always is dependant on exchange rates Mr Ashworth said. 
The pig sector is facing some of the biggest issues though, with end prices still 12% lower than last year and a rise in the national herd. 
In addition, the industry is still struggling to cope with the continued ban on exports to Russia, private storage aid and the huge rise in the price of proteins, with the value of soya having gone up from £260 per tonne in January to £350 for November.
The new pig plant is nevertheless now up and running to capacity.
Throughout 2015, Mr Ashworth said the Scottish beef herd saw a 0.4% increase to 424,500 head by December 2015, while a 12.5% rise was witnessed in the sow herd, to 37,300 head. Breeding sheep numbers, however, eased by 1% to 3.011m head. 
England and Wales remained the largest market for Scottish processors last year, with more than two-thirds of all revenues being generated there. 
Export sales are estimated to have risen by 4% to £76.5m with increased beef exports more than offsetting a decline in sheepmeat exports. 
Farmgate cattle prices fell back for a second successive year in 2015 with Scottish abattoirs paying an average of 361p/kg dwt for steers, down 2% on 2014.
A difficult sheep trade led to a 9% fall in the average producer prices at Scottish auctions to 167p per live kg. Prime pigs fell the most though, down 17% on 2014 levels.
Input costs nevertheless fell, and to their lowest level since 2010. They dropped 4.5% in 2015, due mostly to the sharp fall in energy, feed and fertilisers.