United Kingdom Agribusiness Report

 Published On: Sep, 2016 |    No of Pages: 79 |  Published By: BMI Agribusiness | Format: PDF
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BMI View: Brexit will be a net negative for the UK agriculture industry due to short-term uncertainty followed by lower revenues and increased costs owing to less favourable subsidies, trade and labour conditions. We expect grains to be the most resilient sector due to its low production costs and greater ease in diversifying trade relationships. In contrast, sugar will be a clear underperformer as the UK will struggle to fully take advantage of the EU quota removal in 2017, while failing to offset this loss with sourcing alternative trade partners. The livestock and dairy sectors will be able to supply a greater share of domestic demand while benefiting from higher prices, although costs of production will also be higher.

Key Forecasts
-Sugar production growth to 2019/20 on the 2014/15 level: -31.6% to 6.5mn tonnes. Over the next ten years, output will decline severely as the UK leaves the EU's protected sugar market, while domestic and alternative export opportunities will only partially offset this loss.
-Sugar consumption growth to 2019/20 on the 2014/15 level: -1.8% to 2.3mn tonnes. We expect sugar consumption in the UK to begin a steady decline in response to the introduction of a sugar tax by the government in 2018, as well as higher domestic prices following Brexit.
-Wheat production growth to 2019/20 on the 2014/15 level: -6.7% to 15.5mn tonnes. Wheat production will see a moderate decline over the next five years due to lower subsidies and wheat prices only slowly bottoming-out from 2016 onwards.
-Poultry consumption growth to 2019/20: 13.5% to 2.4mn tonnes. Demand for poultry will be strong as the meat is a cheaper and leaner source of protein than either pork or beef, which will make it appeal to UK consumers over the coming years, especially as domestic prices increase after the UK leaves the EU.
-2016 real GDP growth: 1.4% y-o-y (revised down from 1.8% since our last quarterly update), down from 2.3% y-o-y in 2015, forecast to rise 1.5% on average annually between 2015/16 and 2019/20.
-2016 consumer price inflation: 0.5% y-o-y average, up from 0.1% in 2015, forecast to rise to 2.1% on average annually between 2016 and 2020.
-BMI universe agribusiness market value growth: USD30.3bn in 2015/16, down by 1.1% y-o-y from USD30.6bn in 2014/15, forecast to rise 1.5% on average annually between 2015/16 and 2019/20.

BMI Industry View . 7
SWOT 10
Agribusiness ......... 10
Industry Forecast 13
Brexit Scenario ..... 13
Grains Outlook ..... 16
Latest Updates ..... 16
Table: United Kingdom - Grains Production And Consumption Outlook . . . 18
Table: Risks To Outlook . . . 18
Structural Trends . 19
Table: Wheat Production & Consumption (United Kingdom 2012-2020) . . 21
Table: Corn Production & Consumption (United Kingdom 2012-2020) . . . . 21
Table: Barley Production & Consumption (United Kingdom 2012-2020) . . 21
Livestock Outlook .. 22
Latest Updates ..... 22
Table: United Kingdom - Livestock Production And Consumption Outlook 24
Table: Risks To Outlook . . . 24
Structural Trends . 25
Table: Poultry Production & Consumption (United Kingdom 2012-2020) . 27
Table: Beef Production & Consumption (United Kingdom 2012-2020) . . . . 27
Table: Pork Production & Consumption (United Kingdom 2012-2020) . . . . 27
Sugar Outlook ....... 28
Latest Updates ..... 28
Table: United Kingdom - Sugar Production And Consumption Outlook . . . 30
Table: Risks To Outlook . . . 30
Structural Trends . 31
Table: Sugar Production & Consumption (United Kingdom 2012-2020) . . . 33
Dairy Outlook ....... 34
Latest Updates ..... 34
Table: United Kingdom - Dairy Production And Consumption Outlook . . . . 36
Table: Risks To Outlook . . . 36
Structural Trends . 37
Table: Milk Production & Consumption (United Kingdom 2012-2020) . . . . 39
Table: Butter Production & Consumption (United Kingdom 2012-2020) . . 39
Table: Cheese Production & Consumption (United Kingdom 2012-2020) . 39
Commodity Price Analysis ...... 40
Global - Global Commodities Strategy ..... 40
Table: Select Commodities - Performance And BMI Forecasts . . . 41
Upstream Analysis ........ 43
Europe GM Outlook ......... 43
Europe Machinery Outlook 49
Table: Select Companies - Sales Forecasts By Region (company-based estimates) . . 54
Europe Fertiliser Outlook . 56
Downstream Analysis ... 62
Food ......... 62
Latest Updates ..... 62
Structural Trends . 63
Table: Food Sales (United Kingdom 2013-2020) . . 64
Regional Overview ........ 66
Europe Regional Overview 66
Competitive Landscape 72
Table: Main Agribusiness Players . . . 72
Demographic Forecast . 73
Table: Population Headline Indicators (United Kingdom 1990-2025) 74
Table: Key Population Ratios (United Kingdom 1990-2025) 74
Table: Urban/Rural Population & Life Expectancy (United Kingdom 1990-2025) . . . 75
Table: Population By Age Group (United Kingdom 1990-2025) . . 75
Table: Population By Age Group % (United Kingdom 1990-2025) . . . . 76
Methodology ........ 78
Industry Forecast Methodology .. 78
Sector-Specific Methodology ...... 79
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