A Creative Study Into the Scope for Increasing Value From Fallen Livestock and Animal by-products

8/12/2019 A Creative Study Into the Scope for Increasing Value From Fallen Livestock and Animal by-products

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ROYAL AGRICULTURAL COLLEGE

100 CLUB

A Creative Study Into the Scope

for Increasing Value from Fallen

Livestock and Animal By-products

by Stewart Houston CBE FRAgsBoard member of the Agriculture and Horticulture Development Board

and Chairman of the British Pig Executive

Final report

June 2012

Sponsored by PIC and National Fallen Stock CIC NFSCo

Annual Fellowship in Food Chain Enterprise 2011/12

REPORT No. 1

ISBN: 978-0-9572178-0-5


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A CreativeStudy Into

the Scope for

Increasing

Value from

Fallen

Livestockand Animal

By-products

ISBN: 978-0-9572178-0-5

PREFACE

The Royal Agricultural College (Est. 1845) has

always been an integral component of the overall

United Kingdom Food Chain and this particularFellowship in Food Chain Enterprise facilitates

the opportunity to consider pertinent aspects of

the modern industry which, in their own way, can

have a significant impact on profitability.

The livestock industries have traditionally focused

on achieving full utilisation of all the components

of the carcase. With the increasing cost pressures

of the current market place, they recognise the

importance of creating Best Practice in every

aspect of their role in the food chain.

The 2011/2012 Annual Fellowship, initiated

by the National Fallen Stock Company, is

specifically focused on the very timely, practical

and commercial issues relating to fallen stock

and animal by-products. This includes the clearobjective of understanding and exploring the full

significance of the animal by-products regulations

as they apply to the UK industry, with particular

regard to the collection and disposal of carcases.

Best Practice can ensure that the true definition

of quality across the food chain is Repeat

Business.

Peel HolroydNDP, DipPoult (HAC), DipAgric (OAC), CBio,

PAS(USA), CSci, FHAAC, FRAgS, FIFST

CHAIRMAN RAC 100 CLUB

June 2012


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Turning wasteful cost into value and profit

Foreword by Stewart Houston

I

n todays ever

competitive glob-

al markets and

given our insa-

tiable demands on theEarths limited natural

resources, none of us

can afford to be waste-

ful. Industry continu-

ously seeks better and

more efficient ways of

producing goods and

services for consumers, who themselves demand

high standards of quality and ethical business

practice. This is as true for food, and, therefore,

livestock production, as for any other sector of

our economy. The National Fallen Stock Company

(NFSCo) had the foresight to propose this study

dedicated to increasing value from fallen stock

and animal by-products and I was glad to be asked

to lead it.

From the outset, I decided to take a broad

approach: looking within and across livestock

production sectors, set in the context of a wider

processing and supply chain, including fallen

stock collectors, renderers and by-product manu-

facturers. That approach has delivered some re-

markable results. I have discovered that the objec-

tive to extract value from fallen stock and animal

by-products, where they are inevitable, runs from

the farm, through collection, processing and into

product quality and design. Poor management in

one stage of the process results in lower quality in

later stages and the final output.

It is this golden thread which needs to be

understood by all players within the supply chain

and for them to think outside the box (ie. not just

within the parameters of their traditional sector)

in the way they manage their business. In other

words, anyone who has a role in the handling

and management of livestock waste should

think more about by-product value and act in a

way that exploits the inherent value of the waste

so that the waste actually becomes less of a li-

ability and more of an asset. This is illustrated by

animal by-product waste from abattoirs, which

historically incurred a disposal cost to the abat-

toir. Nowadays, some of the same waste material

attracts a payment from processors, who require

high quality ingredients for their own manufac-

turing (eg. in pet food production).

Larger volumes of good quality animal by-

product are likely to offer greater potential for sup-

plying new and emerging markets eg. in renew-

able energy and feed for aquaculture. Individual

farmers are unlikely to bring such changes about

in isolation but if whole sectors working as part

of an animal by-product supply chain move in a

certain direction, collectively they may be able to

generate economies of scale justifying new invest-

ment in additional processing plant or new tech-nologies.

As much as possible, I have focused on prac-

tical solutions (existing and near-market) that can

be introduced and explored now. Livestock pro-

ducers and others may be able to reduce costs of

fallen stock disposal, on average by as much as 25

percent (or 10m across all sectors) and increase

value from unavoidable fallen stock and animal

by-products by a further 17-20m. This report

also identifies areas for further research in the pur-

suit of knowledge transfer and the development

of practical solutions of even greater added value.

If all the potential opportunities identifiedin this report were acted upon by industry, the

eventual benefits to industry could be worth in

excess of 40 million per annum. Improvements

to economic performance also deliver a num-

ber of environmental and social benefits. These

range from reduced levels of odour and noise in

local communities, to a greater use of renewable

energy contributing to fewer greenhouse gas

emissions and their impact on climate change.

In undertaking the study and presenting this

report, I have been fortunate to have had a lot of

support from others, whose expertise and skills

have delivered an output where the total is fargreater than the sum of its parts. While I am grate-

ful to the many organisations and people who

contributed to this study, I wish to record special

thanks to each and every member of a core-group,

without whose dedication this report would not

have been possible: Ian Campbell, Director of NF-

SCo; Stephen Woodgate, Director of FABRA; Bob

Bansback, Professor at Harper Adams University

College; and Duncan Prior, Independent Consult-

ant.

Teamwork has been the cornerstone through-

out this study and I think it is important to main-

tain that theme across the supply chain in tak-ing forward the recommendations in this report,

whether they are addressed to individual specie

sectors, the supply chain collectively or to Govern-

ment. It will be important to remember that the

changes required to deliver the benefits cited in

this report will not happen overnight. However,

with effort maintained collectively by all potential

beneficiaries, I am convinced that such effort will

be rewarded commensurately. I therefore com-

mend this report to all relevant parties and hope

it will provide a useful kick-start towards realising

significant benefits.

Stewart Houston CBE, FRAgS is a Fellow of the Royal Agricultural Society; a member of the Agriculture and Horticulture

Development Board and Chairman of BPEX; Director of the National Pig Association; member of COPA COGECA (the EU

committee of agricultural trade associations); non-executive Director of the Scottish Agricultural College; and a member of

the Animal Health and Welfare Board for England. He was awarded the CBE in 2007 for services to agriculture.


the Scope for

Increasing

Value from

Fallen

Livestockand Animal

By-products


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CONTENTS

Introduction/Acknowledgement ......................................................................................................................................... 5

Executive Summary ................................................................................................................................................................... 6

Chapter 1: Industry Structure and Economic Factors .......................................................................... ................ 8

Chapter 2: Mitigating Fallen Stock and Animal Disease ............................................ ....................................... 10

Chapter 3: The Animal By-products Sector ................................................... .................................................... .... 14

Chapter 4: Fallen Stock Disposal ..................................................... .................................................... ...................... 17

Chapter 5: Animal By-products from Food Business Operators ............................................... ..................... 19

Chapter 6: Recommendations and Working Together on Solutions ............................................... ............ 21

Chapter 7: Progressing Change More Swiftly ............................................... .................................................... .... 23

Appendix 1: Questionnaire to Stakeholders .................................................... .................................................... .... 24

Appendix 2: Respondents to Questionnaire ................................................... ..................................................... .... 24

Appendix 3: Best Practice Case Study Biosecurity ............................................... ............................................... 25

Appendix 4: Regulations Covering Animal By-products .............................................. ....................................... 26

Appendix 5: Analysis of the Economic Impact of ABP Freshness and Quality Parameters

for Rendering ........................................................................... ..................................................... ............. 29

Appendix 6: Danish On-farm Refrigerated Storage Units ................................................................................... 30

Appendix 7: NFSCo/NFSS .................................................... ..................................................... ....................................... 32

Appendix 8: Research on Alternative Disposal Methods ............................................................... ..................... 33

Appendix 9: An Example of the Challenges of getting Approval for New Processes ............................... 34

Appendix 10: FABRA Initiative on Training and Education .................................................................................... 35

Glossary .................................................... .................................................... ...................................................... ............ 36


the Scope for

Increasing

Value from

Fallen

Livestockand Animal

By-products


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the Scope for

Increasing

Value from

Fallen

Livestockand Animal

By-products

INTRODUCTION

1. In collaboration with the National Fallen Stock

CIC (NFSCo), the Royal Agricultural College (RAC)

invited me to review current practice in manag-

ing fallen livestock, animal by-products and con-

demned material of animal origin and to make

recommendations for future improvements and

cost savings. This report is the culmination of that

study, in which I have adopted a practical ap-

proach towards the challenge of increasing value

from fallen stock and animal by-products (ABPs).

2. Many individual livestock producers and alliedindustries continually review their management

arrangements in this area. Trade associations and

other representative bodies also have relevant

programmes of on-going R&D work as do some

academic institutions. This study did not seek to

duplicate any of that good work. Instead, it took

a pragmatic approach, through asking the funda-

mental questions: What is the current state of the

industry in relation to fallen stock disposal and ani-

mal by-product returns? and, Where are the key

opportunities for delivering improved outcomes?

3. To help validate an understanding of the is-

sues and identify or accelerate solutions to them,

a short information-gathering questionnaire was

sent to representative organisations and profes-

sional bodies across principal livestock production

sectors, allied industries and others. The question-

naire (see Appendix 1) was a managed way of en-

gaging interested parties in providing a first cut

at addressing these issues. The advantage of this

approach was that it not only drew out consult-

ees interpretation of the problem areas but also

helped to identify the extent to which there was

appetite to address them. The scope of the project

was not, therefore, constrained at all, but allowed

stakeholders to influence its direction and focus.

4. Questionnaire responses and other contribu-

tions came from a diverse range of people and

organisations, including significant livestock and

other sector organisations, as well as individual

producer and veterinary practitioners. Individual

and organisation respondents are listed at Appen-

dix 2. Many specific issues arising from stakeholder

consultation and recommended responses/solu-

tions, are included in this report.

5. Although livestock producers have a direct in-

terest in the subject when it comes to fallen stockresulting from on-farm mortalities, we sometimes

forget that we also have a big indirect interest in

the value obtained from animal by-products both

from meat plants and other food businesses. After

all, these values can in turn influence the price re-

ceived by the producer for his stock at auction or

through direct sale at the abattoir.

6. The Report therefore starts by looking at the

structure of the animal by-product chain and at

those key areas where animal by-product values

(including fallen stock) can be enhanced or costs

reduced. In Chapter 2, I address the importance of

reducing on-farm mortalities. Chapter 3 describes

the structure of the animal by-products sector

and the different categories of ABP product in the

context of the legislative framework. In Chapter 4,

I identify the particular issues and opportunities

relating to fallen stock disposal. Chapter 5 looks

at the animal by-product categories disposed of

by meat plants and other food business operators

(FBOs). After all, these account for the vast major-

ity of the volume of ABPs. In Chapter 6, I draw con-

clusions on the steps to be taken to improve the

situation. Finally, in Chapter 7, I propose how we

should move from here in initiating change.


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EXECUTIVE SUMMARY

THE CHALLENGES

ES1.The annual cost of collection and disposal of

fallen livestock in the UK is estimated to be about

40 million, including lost value from the even-

tual sale of the animal. In addition to the impact

of fallen stock costs, producers also have an in-

terest in those parts of the animal which are not

sold for consumption. It is vitally important for the

competitiveness of the UK livestock industry that

returns on animal by-product disposal increase as

much as possible in coming years.

ES2. The UK currently produces about 2.5 million

tonnes of ABP a year. In practice, about 90% is pro-

cessed through rendering, with other treatments

taking up the rest. Historically, a disposal cost fell

on the producers of ABPs but more recently the

commercial value of some ABPs (eg as ingredients

for pet food or biofuel) has resulted in producers

receiving payment. The challenge is to transfer

more and more material from being a costly liabil-

ity to a valued commodity, by increasing the Gross

Value to a maximum, by whatever means.

THE PRIZES

ES3. Although it is difficult to estimate accu-

rately the potential savings achievable through

the adoption of best practice across the livestock

industry as a whole, a 25% reduction in mortality

rateshould achieve savings in the order of 10 mil-

lion per annum, as well as improving the produc-

tivity of the farming unit.

ES4. Progress is being made to amend the EU

ABP control regulations to allow certain treated

material to be used as animal feed initially using

non-ruminant processed animal protein (PAP) for

aquaculture feed. If the proposal is adopted, the

potential commercial benefit could be significant:

for example, the British pig and poultry sectors

could enjoy a net value increase of 17- 20m per

annum.

ES5. Other work is being pursued to demonstrate

the public and animal health safety aspects of

using known technologies and techniques to en-

hance the value of fallen stock and ABPs. Examples

here include better on-farm treatment and stor-

age of carcases to reduce volume and disposal

costs and to increase the value of residual material

through preserved quality (ie freshness). A use-

ful example for quantifying potential benefit is

the on-farm carcase refrigeration method used in

Denmark. Notwithstanding the need to research

the applicability of the Danish arrangement in the

UK, the benefit could be worth some 7.5 million

per annum. It is not difficult, therefore, to envisage

potential savings and added value running into

many millions across British livestock and other

sectors.

ES6. If all the potential opportunities identified in

this Report were acted upon by industry, the even-

tual benefit to industry could be well in excess of

40 million per annum.

THE WINNERS

ES7. An important feature that emerged during

this study is that there is a golden thread running

through all stages of dealing with fallen stock and

ABPs from original production to final disposal/

reprocessing where performance in one stage

directly affects performance in later stage(s).

ES8. Provided the supply chain as a whole em-

braces these opportunities as a complete pack-

age (and individuals within the supply chain are

not tempted to cherry-pick isolated elements

that only serve immediate self-interest) there isno reason why all components of the supply chain

should not benefit including farmers, fallen stock

collectors, renderers and anyone who handles

ABPs.

TIMESCALES

ES9.The regulatory process required for change is

reason to be cautious and realistic about the likeli-

hood of substantial change leading to significant

increases in the value of ABPs in the short term.

However, with continuing advances in science

and technology, combined with a positive shift in

political attitude, it is reasonable to assume that

effort invested in bringing about change will be

rewarded over time.

KEY AREAS FOR IMPROVED PERFORMANCE

ES10. There are a number of important areas

where industry can improve performance, includ-

ing:

Improving effective management processes

and techniques across all aspects of business.

Developing better animal health management

through effective farm health plans, which are

implemented and maintained.


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Implementing more stringent biosecurity

arrangements to prevent the incursion and

spread of animal diseases.

Working more closely with Government in

systematic surveillance of animal diseases and

their control.

Increasing value from animal by-products by

unlocking potential value currently lost by

inefficiency and lack of effectiveness in the way

such material is managed.

LIVESTOCK SECTOR DIFFERENCES

ES11.When considering fallen stock, it is impor-

tant to appreciate the differences between live-

stock sectors, whether it be the extent to which a

sector has a fully integrated supply chain; life cy-

cles for production; the size of individual animals

relative to disposal costs; geographical location

and remoteness; frequency of livestock mortality;

and so on. Against that backdrop, it is perhaps un-derstandable that there are individual producers

who are relatively more advanced than their peers

within their sector but, strategically, sectors would

probably stand to gain more by investing effort to

improve performance from their current position

on the continuum (see illustration above).

PRACTICAL STEPS TOWARDS REALISING THE

POTENTIAL

ES12. There are many practical steps leading to

reduced costs and increased value in the manage-

ment of fallen livestock and animal by-products:

Reducing on-farm livestock mortality.

Reducing costs of fallen stock collection.

Enhancing the value of ABP.

Industry working with Government.

ES13.As well as addressing species specific issues

on a sector basis, livestock sectors should collabo-

rate on a shared agenda, not just in seeking to fa-

cilitate relevant knowledge transfer and take-up of

best practice but also in developing new solutions

through combined effort (and where necessary

pooled resources).

RECOMMENDATIONS FOR ACTION

ES14.There appears to be a real opportunity for

moving things forward and making progress in a

number of areas. Against this backdrop of positive

attitude and the desire to realise the potential de-

scribed in this report, I make the following recom-

mendations in the form of a first-step action plan

towards the goal of increasing value from fallen

stock and animal by-products:

Relevant sector bodies to attend a half-day

workshop to consider this report and agree

steps to be taken by individual sectors, by

species supply chains and overall collaborative

activity.

In each area to consider the question, What are

the fallen stock and ABP challenges; are they

being adequately addressed; and what more

can be done to deliver valued outcomes? andto prepare an action agenda that will realise

immediate benefits for their constituency.

In relation to collaborative action, to have a co-

ordinated plan drawn up.

ES15. Furthermore, one or two organisations may

be prepared to volunteer their good offices to co-

ordinate cross-sector collaboration. AHDB work-

ing with NFSCo would appear to be the natural

team, given their coverage of red meat and dairy

beef sectors and focus on delivering reduced cost

solutions. I therefore recommend to AHDB and

NFSCo that they agree to take on the coordinat-

ing role, if sufficient industry commitment is evi-

dent.

Ruminants Pigs & Poultry

LIVESTOCK SECTORS ON THE CONTINUUM OF BEST PRACTICE

Adoption of existing best practice Emerging new best practice/existing R&D New R&D


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A Creative Study Into the

Scope for Increasing Value

from Fallen Livestock and

Animal By-products

Chapter 1: Industry Structure and Economic

Factors

1.1. It is understandable that livestock producers focus on the prin-

cipal costs of production (capital investment, labour and input costs)

when seeking innovative ways of reducing overall costs and/or en-

hancing efficiency (eg. via better feed conversion rates). Productivity

improvements in these areas of business can lead to the most sig-

nificant savings and better returns on investment. But to do so exclu-

sively, is to ignore the potential enhancements from those aspects

of the business which offer relatively smaller advantages but which

nonetheless can still be significant in cash terms.

1.2. As markets become more and more global (both the opportu-

nity of exports, but also the threat of imports), competitive pressure

increases, giving rise to renewed incentive to minimise the cost of

production. In times of highly competitive markets and small profit

margins, the difference between realising or not realising even the

smallest of efficiencies can be the difference between winning or los-

ing a contract ultimately impacting on a businesss sustainability.

1.3. The annual cost of collection and disposal of fallen livestock in

the UK is estimated to be about 40 million. This is the direct cost to

the livestock industry (cattle, sheep, pigs, poultry and horses), includ-

ing the producers loss from not getting value from the eventual saleof the animal. There are a number of indirect costs to add to this

including the potential impact of reduced biosecurity. Finally, there

are externality costs to wider society, such as impacts on the environ-

ment through waste management and disposal.

Farmers collection/disposal costs for fallen stock vary widely

from area to area around the country

Indicative figures per head:

6-12 month lamb 10-15

2 year old bovine 65-90

Finished pig 12-16

Estimated 1fallen stock disposal costs as percentage of totalproduction costs:

Upland breeding sheep 2.7%

Lowland breeding sheep 2.1%

Most other livestock categories 1.0%

1.4. It is evident that under-performing farms should be able to

adopt better existing practice and benefit immediately from higher

productivity and lower disposal costs from fewer incidents of fallen

stock. High standards of on-farm animal husbandry are often the

best way of mitigating the risk of significant financial loses through

fallen stock and other detrimental impacts on farm or, indeed, across

national herds (eg. in the case of farm to farm disease spread).

1.5. However, in addition to the impact of fallen stock costs, pro-

ducers also have an interest in returns or disposal costs for animal

by-products in general, ie. the value put on those parts of the ani-

mal which are not sold for meat or edible offal consumption. This has

been calculated as 58% of a sheep carcase, 53% for cattle and 40% for

pigs (See Figure 1). Some of these by-products have significant value

while others are disposed of at considerable cost. Traditionally, the

fifth quarter, as these items have collectively become known, has

been sufficient to more than cover the costs associated with slaugh-

tering. In other parts of the world this is still the case indeed, by-

product values play an important role in maintaining profitability of

meat businesses. However, in the UK (since the introduction of legis-

lation during the BSE outbreak in the mid-1980s), animal by-product

disposal is still a cost to the ruminant livestock sector; even returns

1From a study commissioned by NFSCo in 2008 Planning for the Future - A Report on issues facing the National Fallen Stock Company. Bob Bansback August 2008


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for pig and poultry producers are significantly less than in some oth-

er countries.

Figure 1: Breakdown of components of cattle, sheep and pigs

into usage and category

Adultbovine

Sheep Pig

Kg % Kg % Kg %

Edible meat 252.0 47.0 15.69 42.3 50.63 60.3

Pet food 31.9 5.9 2.74 7.4 3.40 4.1

Rendering (excl. gut content) 95.7 17.8 6.25 16.8 10.27 12.2

Specified Risk Material (SRM) 9.2 1.7 1.16 3.1 0 0

Hide and skin 38.0 7.1 4.10 11.0 4.00 4.8

Gut content 80.0 14.9 4.50 12.1 8.40 10.0

Other 29.6 5.5 2.66 7.2 7.20 8.6

Total liveweight 536.6 100 37.10 100 83.90 100

Source: Agriculture and Horticulture Development Board. Note: Fig. 1

contains estimated data. Some categories may go into more than one

section, and it is therefore dicult to obtain an exact breakdown.

1.6. It is noteworthy that gut content represents a significant ele-

ment of a slaughtered animal. It would be worth researching waysof reducing gut content so that an animal goes to slaughter with an

empty stomach, especially in cases where savings could be made by

reducing valuable feed (eg. pig rations) being consumed in the pe-

riod before slaughter.

1.7. It is vitally important for the competitiveness of the UK live-

stock industry that returns on animal by-product disposal increase

as much as possible in coming years. This would have an impact on

meat plant profitability with potential implications right along the

chain, including producer prices.

1.8. Figure 2 shows the simplified structure of a typical livestock sup-

ply chain. Points A, B and C indicate areas where there is scope for

cost reduction or value enhancement for fallen stock and animal by-

products.

1.9. The interdependence of the whole chain means that there is

a collective interest in reducing costs and enhancing value if future

competitiveness of the UK meat and livestock sector is to be sus-

tained.

B

C

Collector

Renderer

Incinerator

AFallenStock

A

BAnimal By-

Product

CAnimal By-

Product

Livestock Production Farm

WholesalerRetailer

Foodservice

Exporter

Auction Market

Meat Plant

Finished Stock for Meat

Production

Figure 2: Typical Livestock Production Chain

Illustrating the dierent stages of animal by-product disposal

The three sources

of animal by-product

Fallen Stock Category 1 or 2 ABP

Category 1, 2 or 3 ABP from FBO

Category 1, 2 or 3 ABP from FBO


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Chapter 2: Mitigating Fallen Stock and Animal

Disease

2.0.1. Across all livestock and allied sectors, the common theme of

prevention is better than cure was repeated by many respondents

to the studys questionnaire. It is helpful to put the challenge into the

context of the waste management hierarchy: reduce, reuse/recycle

and dispose. Although it might seem obvious that by reducing the

volume of fallen stock the consequential disposal costs are similarly

mitigated, it would appear that many respondents considered that

many livestock producers had the potential to adopt better manage-

ment practices in their businesses.

Below: Healthy animals are productive animals.

2.0.2. Figure 3 shows the current (ie. April 2012) average prices of

some British red meat livestock categories, to demonstrate the po-

tential value to be realised from avoidingfallen stock (ie. in addition

to the saved costs associated with fallen stock disposal):

Figure 3: Average prices of selected livestock categories

Livestock type April 2012 average price (per head)

Prime cattle 1190

Cull cows 840

Prime lambs 91

Cull ewes 83

Finished pigs 113

Weaners 43

Source: Based on Agriculture and Horticulture Development Board with per kilo

prices converted to per head using average carcase weights.

2.0.3. Figure 4 shows, for different species of British livestock, aver-

age mortality rates at farm level compared to mortality rates achieved

by the farms in the top third of the mortality performance league. Forexample, on average, fallen stock from cattle is about 2.8%, whereas

the top third of better performing farms suffer just over 1.7% loss.

Sheep mortality rates are 2.6% on average, compared to 1.5% in the

top third. Obviously, the gap between the worst performing farms

and the best, offers even greater scope for improvements and com-

mensurate savings in most cases.

Figure 4: Mortality levels across British livestock farms

Source AHDB

Livestock Species Average Top Third*

Cattle 2.8% 1.7%

Sheep 2.6% 1.5%

Pigs (pre-weaning) 12.7% 8.5%

Pigs (post-weaning) 5.2% 2.3%

* The gure for the top third of producers is based on mortality perfor-

mance alone.

2.0.4. Currently, it is difficult to estimate accurately the potential

savings achievable through the adoption of best practice across the

livestock industry as a whole but a 25% reduction in mortality rate

should achieve savings in the order of 10 million per annum, as well

as improving the productivity of the farming unit. (It is worth noting

that farms performing best overall do not necessarily have the lowest

mortality rates. It is usually the case that top performing producers

achieve lower production costs in the round. This means that in some

cases, even the most economic farms can improve their mortality

rates leading to even higher levels of productivity.)

2.1 Getting On Top of the Business

2.1.1. When considering the need for fallen stock disposal, knowl-

edge about the volumes and dynamics of individual sectors helps us

understand why mitigating fallen stock costs for one sector is a high-

er priority than it is for another. For example, in the poultry meat sec-

tor, controlling and reducing mortality is accorded high priority with

stringent farm biosecurity and formal training of stock personnel

designed to prevent losses through disease incursion or husbandry

failures potentially affecting large numbers of birds on increasingly

large farms.

2.1.2. The intensive production systems typical of the pig and poul-

try sectors (especially the large commercial operations), predomi-

nantly have sophisticated management arrangements in place, sup-ported by IT, continually monitoring all aspects of production (and

costs) enabling timely and appropriate management intervention

when necessary. For poultry, daily cumulative mortality and culls re-

cording and reporting is a legal requirement. Cattle and sheep, on

the other hand, are largely produced on extensive farming systems,

where highly skilled stockmanship is used to manage and monitor

herds and flocks. Across all livestock sectors, producers are increas-

ingly focused on the need to manage their livestock effectively.

2.1.3. However, it would appear that in all sectors there are incidents

of poor livestock management practice, where businesses should be

informed of the risks to which poor performance is exposing their

business (and, in cases such as health monitoring/disease surveil-

lance, other businesses in their industry). Demonstrating the benefits(both practical and economic) of effective management processes

and techniques across all aspects of business is the first key step to

incentivising poor performers to want to improve. Where businesses

require help in identifying best practice, their trade bodies should be

able to provide support and guidance. For example, the EBLEX Better

Returns Programme (BRP) encourages English beef and sheep pro-

ducers to evaluate their businesses to identify where improvements

can be made in terms of cost reduction, environmental impact and

animal performance.

2.2 Animal Health Management

2.2.1. There appears to be little difference between livestock sectors

on the causes of fallen stock: mainly disease, poor health conditions

(eg. lameness, mastitis, pneumonia, and so on), physical injury and,


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in some cases, animals being kept beyond their optimum produc-

tion age (a practice which itself increases health risks as older animals

become more vulnerable to disease and poor health conditions). Al-

though producers live with these factors on a day-to-day basis, some

appear unable to easily address the issue, especially if they are una-

ware of health problems (eg. liver fluke).

2.2.2. However, the situation is improving. In the pig industry a

scheme exists whereby abattoirs provide an immediate report to the

producer when endemic disease or other health problems are wit-

nessed at slaughter. This information is used by the producer, work-ing with his/her vet, to take remedial action. For cattle and sheep, the

Food Standards Agency is working with industry, including the NFU,

on a similar initiative for those sectors. Some abattoirs have taken a

lead and will be feeding back ante and post-mortem information to

farmers in their supply chain.

2.2.3. Mitigation of disease risk, poor animal health and physical in-

jury can be achieved via effective on-farm biosecurity arrangements

(see biosecurity below). A particular issue is the possible imposition

of official controls during a notifiable disease outbreak and the im-

pact those controls could have on otherwise routine fallen stock

collection arrangements (eg. a requirement for longer periods of

on-farm carcase storage). These and other specific health manage-

ment factors need to be contained within an effective farm healthplan which is implemented and maintained, NOT a document lost in

the farm managers office! There is plenty of advice and good prac-

tice readily available on how to go about implementing farm health

plans. Defra has undertaken a lot of work with producers on design-

ing effective farm health plans but still many farmers appear to need

further encouragement towards buy-in. The pig sector sets a good

example of implementation with its Pig Health Improvement Project

(PHIP), which aims to reduce national endemic disease (see Figure 5).

Figure 5: Pig Health Improvement Project

Pig Health Improvement Project (PHIP)

Since its launch in July 2011, PHIP has given all pig producersthe chance to join an industry-wide drive to improve pig

health. It builds on the successes of producers taking part in

regional projects in Yorkshire and Humberside, East Anglia and

East Midlands. The aim is to assist producers in taking a more

collaborative approach to pig health with the help of vets and

allied industries.

PHIP offers five useful services to help producers achieve their

health improvement goals:

BPEX Pig Health Scheme (BPHS) Reports an invaluable tool

for vets and producers to receive advance warning of sub-

clinical disease issues

Local Health Mapping enabling producers to access thehealth status of farms in their local area who also register

with the project

Bespoke Biosecurity Action Plans formulated with their vet

to help reduce the risk of unwanted disease entering their

farm

Disease Testing support provided for groups of producers

and accessed with the help of their vet(s)

Regional Support dedicated BPEX staff to help producers

meet their health targets and support group activities in

their area.

Further information about PHIP:

www.pighealth.org.uk/health/home.eb

2.2.4. Also, producers need to keep up to date with work to develop

genetics with disease resistance qualities, and sector bodies need to

keep their R&D programmes under constant review. This is not to say

R&D is failing but some sectors may be further ahead than others

and there may be scope for learning from or working in collaboration

with other sectors (see Chapter 6).

2.3 Biosecurity

2.3.1. Biosecurity is a general term used in the context of mitigat-

ing the risk of pathogens being contracted by livestock. Biosecurity

measures include permanent physical arrangements to prevent the

spread of infectious diseases both within a farm and from one

farm to another or from elsewhere (eg. an abattoir); as well as con-

tingency arrangements to be used as a response when business as

usual biosecurity fails. Measures focus on the movement of people,

vehicles and equipment and animals on and off livestock premises,

as well as in the design and construction of those premises (eg. to

minimise exposure to risk, including airborne pathogens).

2.3.2. Aligned to poor on-farm health monitoring, there is often to

be found a lack of preventative measures, particularly biosecurity (eg.

where fallen stock collectors arrive at farms without dedicated collec-

tion points, causing collectors to wander about farms unaccompa-

nied looking for carcases). Poor biosecurity was reported even where

livestock sector-specific biosecurity protocols and codes of practice

exist. Interestingly, such measures are employed during disease out-

breaks - especially notifiable diseases, where farmers are placed un-

der legal duty to do so. Poor biosecurity poses a threat not only to the

individual production site/farm, but also to neighbouring sites and

the wider industry at large. Where extensive farming systems make

defending a perimeter impractical, farmers should consider moving

fallen stock carcases to a location fully separated from main produc-

tion areas. This can be designed in liaison with collectors to facilitate

biosecure collection arrangements.

2.3.3. However, it would be wrong to draw from this the conclusion

that nothing is being done to improve the situation. There is much

good practice either in place or being developed. For example, the

British Cattle Veterinary Association has promoted biosecurity man-

agement, including specific protocols for many years through prac-

titioner CPD, publications and Farm Health Planning, as well as the

health planner tool, MyHealthyHerd. DairyCos Healthy Feet is another

example of a sector-wide initiative helping to reduce the incidence

of poor animal health on-farm. Under the Equine Health and Welfare

Strategy2, the importance of biosecurity is recognised, and a code of

practice is being developed (the racing and breeding sectors already

have voluntary codes of best practice).

Myhealthyherdprogramme helps farmers:

Evaluate herd health and disease measuring costs and recov-

erable losses due to health and disease problems that may becausing inefficient production in a herd

Create plans that will assist effective herd health management,

as well as comply with farm assurance standards

Manage infectious disease that may threaten herd health

protecting herds from common diseases and creating controls

where disease already exists.

For further information see: www.myhealthyherd.co.uk

2www.equinehealthandwelfarestrategy.co.uk/home


12/3712

DairyCos Healthy Feet programme helps dairy farmers reduce the

number of lame cows on their farms by identifying and applying

the right management techniques.

The Programme is a step-wise approach towards diagnosing

the problems, devising an action plan and developing the skills

necessary for long-term lameness control. Trained providers (vets

or foot trimmers who have attended a specialist course) facilitate

the whole process and act as one-to-one advisers or mobility

mentors.For further information see: www.dairyco.org.uk/farming-info-

centre/healthy-feet-programme.aspx

2.3.3. With examples of good practice available for biosecurity

measures and farm health planning (eg. in the pig and poultry sec-

tors), the key question must be: Why are such practices not employed

by all livestock producers and how can such producers be encour-

aged to act in their own self-interest?

2.3.4. It is equally incumbent on the farmer to mitigate the risk of

endemic disease spread to neighbouring farms and others by keep-

ing disease in as well as out. Again, demonstrating the benefits (both

practical and economic) of employing effective biosecurity measuresis the first key step to incentivising poor performers to want to im-

prove. At national level, industry is working with Government to re-

duce and eradicate endemic diseases.

Good biosecurity is paramount.

2.3.5. In the pig sector, BPEX has produced a guidance note as part

of its Action for Productivity programme (see www.bpex.org.uk) set-

ting out practical biosecurity measures farmers can adopt to:

Limit the spread and occurrence of disease.

Improve overall herd health.

Increase the growth and efficiency of the herd.

Appendix 3 provides a case study of good biosecurity practice in the

pig sector, reflecting the guidance from BPEX.

2.3.6. As well as farmers practicing good biosecurity voluntarily, un-

der NFSCos National Fallen Stock Scheme, collectors and farmers are

required to adhere to the Schemes biosecurity guidance (see www.

nfsco.co.uk), together with any biosecurity procedures that may al-

ready be in place by the local authorities.

National Fallen Stock Schemes Key Biosecurity

Requirements:

Collectors must ensure:

The outside of vehicles or trailers are cleaned and disinfected

before arrival on every farm

Appropriate protective clothing is also cleansable and disin-

fected between farm premises

Fallen stock collection vehicles are not taken into areas where

there are live stock

Refrain from entering livestock areas themselves.

Farmers also have an obligation to make sure that biosecurity on

their premises is not jeopardised during collections. They:

Are encouraged to develop methods of working which are

designed to minimise the movements of people, vehicles and

equipment into areas with livestock

Must remove any fallen stock to areas where other livestock

and wildlife do not have access

Should, where possible (eg. poultry, young stock, small rumi-nants), store deadstock in leak-proof, ventilated and covered

containers.

2.4 Systematic Surveillance

2.4.1. While physical biosecurity measures help to prevent the

spread of disease onto and within a farm, those arrangements need

to be complemented by constant, systematic surveillance. Farm vet-

erinary advisers are an important first point of information but more

can be done at sector level, for example, the pig sector introduced

the BPEX Pig Health Scheme (BPHS). BPHS uses vets to assess a range

of health conditions in pig carcases slaughtered in specialist pig ab-

attoirs in England. This provides early warning of emerging disease

problems so producers can take action before they become a crisis.

It gives producers an objective measurement of the health status of

their herd so that health management programmes can be planned,

eg. parasite control. BPHS measures the effectiveness of vaccinations

and treatments helping to decide what and when to use.

2.4.2. Also, farming sectors can and should work with Government

to optimise national arrangements for surveillance. As part of its cur-

rent review of routine animal disease surveillance (both existing and

emerging diseases), the Animal Health and Veterinary Laboratories

Agency (AHVLA) is considering a more managed and systematic ap-

proach to using fallen stock from farms as an important input to its

Surveillance Programme. Currently, farmers may offer fallen stock to

AHVLA at their own discretion (and cost of delivery) to a local testing

laboratory for investigation. While this has provided a useful source

of testing material, it is a practice that has lacked formal assessment

by AHVLA in determining the value of such donated carcases/mate-

rial for post mortem analysis.

2.4.3. With appropriate guidance to farmers and their vets, AHVLA

should be able to enhance surveillance effectiveness by ensuring

that fallen stock samples are taken in a managed way that, for exam-

ple, provide optimal geographical spread across all animal species (in

a way that maximises alerts not only to individual suspect cases but

geographical and species related disease issues/trends). Carcase post

mortem need not rely wholly on the provision of dedicated labora-

tory testing. Local post mortem examinations (on-farm and/or at re-

gional fallen stock collection points) could be capable of offering an

alternative service efficiently and effectively.


13/3713

2.4.4. In addition to any regime that might be established for physi-

cal collection and testing of fallen stock, AHVLA should be able to

use management information relating to fallen stock to identify pos-

sible alerts and trends. This should provide a cost-effective element

to underpin and complement a pre-planned practical testing regime.

2.4.5. Reporting mortality is a legal requirement for poultry flocks

going to slaughter. AHVLA should consider how best to use that data

as part of national surveillance. Also, other data to which AHVLA cur-

rently does not have access could be used. For example, the statistics

collected by NFSCo already show fallen stock trends year on year (bygeography and by species). There is currently a delay in this informa-

tion being reported by collectors, who do so once a month (thereby

delaying an incident/collection report by up to a month). If neces-

sary, it would be possible to introduce adapted reporting procedures

to facilitate live reporting as incidents occur. This option would allow

central analysis to identify possible disease and animal health risks/

spikes in fatalities, which may not be seen at the local veterinary

practice level for some time. NFSCo has made these observations to

AHVLA and stands ready to explore further with AHVLA the possibil-

ity of using a NFSCo statistical alert function.

2.4.6. Trade and other organisations offer a range of advice and

support services to livestock producers. Figure 6 contains key points

promulgated across sectors on how to achieve lower mortality levels.

Practical steps towards less fallen stock

CATTLE AND SHEEP

Use your vet as an adviser

rather than just for

emergencies - put in place

a herd/flock health plan to

manage disease risks. Implement a biosecurity

policy for bought-in stock

and stock returning from off

the farm.

Cull cows before they get too

old to be productive or at the

sign of health problems.

Better use of Estimated

Breeding Values, particularly

for calving ease and

longevity.

Keep good records so that

replacement females can be

bred from cows or ewes thatare easy to manage and have

long productive lives.

Good health planning to

ensure proactive treatment,

eg. worm control in lambs

and calves, pneumonia

prevention in cattle.

Use appropriate tests to

diagnose infectious diseases,

eg. BVD in cows, enzootic

abortion in ewes.

A good health plan should

also provide decision support

for unplanned problems.

Good feed management

around lambing and calving

to reduce death rates.

Select bulls and rams with

Estimated Breeding Values

for calving and lambing

ease to reduce potential

problems.

PIGS

Manage health status,

stabilise and improve. Farm

health plan should be a living

document and not a paper

exercise.

Define a perimeter to

the production site and

minimise live and deadstock

traffic across it. Avoid yourneighbours bugs and

protect your neighbour from

yours.

Join local PHIP cluster group

and engage with local

producers and hauliers.

Monitor and record mortality

level, reason and weight

of pig - helps identify age

groups most at risk.

Good cleansing and

disinfecting protocols

between batches.

Animal husbandry skills andon-going staff training.

Reinvestment in buildings

and operating systems.

Engaging the services of a

pig specialist veterinarian

and being prepared to

change if necessary.

POULTRY

Manage health status,

stabilise and improve. Farm

health plan should be a living

document and not a paper

exercise.

Good cleansing and

disinfecting protocols

between batches*.

Animal husbandry skills and

on-going staff training*.

Reinvestment in buildings

and operating systems.

Engaging the services of a

poultry specialist veterinarian

and being prepared to

change policies and

applications if necessary*.

(*required by EU law)

Figure 6: Practical steps towards lower mortality levels


14/3714

Chapter 3: The Animal By-products Sector

3.0.1. Fallen stock and slaughterhouse by-products (SBP) are both

considered as animal by-products (ABP) as described in the EU/UK

veterinary regulations. As such, many of the regulatory controls, pro-

cessing options and economic considerations apply to both items.

3.0.2. Animal by-products are subject to a requirement to be treated

in accordance with EU law. (An official definition of ABP and an in-

troduction to the full range of the regulations is listed in Appendix

4). The current and main legislative instrument for land (and fishery)by-product treatment in Europe is the Animal By-Products Regula-

tion (ABPR) (1069/2009). This regulation is supplemented by an Im-

plementing Regulation (ABPR-IR) (142/2011). ABPR/1069 includes all

of the key aspects regarding categorisation, treatment, disposal or

use of all animal by-products. The first and key aspect of the legisla-

tion is the placing of animal by-products into categories according

to their risk to humans, animals and the environment. Figure 7 sum-

marises the Categories and the main type of material that is found in

each one.

Figure 7: Summary (non-exhaustive) of types of ABP according

to ABPR Category

Category Animal by-products per Category (Summary;Non-exhaustive)

1

Animals suspected of being infected by a TSE

Specified Risk Material (SRM) and entire bodies of

dead animals containing SRM.

Mixtures of Category 1 with either Category 2 or

Category 3 material.

2

Animals and parts of animals, that die other than

by being slaughtered for human consumption (eg.

fallen stock), including animals killed to eradicate

an epizootic disease.

Mixtures of Category 2 with Category 3 material.

3

Animal by-products or parts of slaughtered

animals, which are fit for human consumption in

accordance with Community legislation but are not

intended for human consumption for commercial

reasons.

3.0.3. There are important key differences between fallen stock and

SBP. Fallen stock is in Category 1 or 2. However, SBP can consist of

all three Categories. In practice, ruminant fallen stock is Category 1

and non-ruminant is Category 2. However, some collectors will col-

lect ruminant and non-ruminant fallen stock and mix them together,

resulting in the whole load being graded as Category 1. SBP is mainly

Category 3. Although it is possible to downgrade ABPs from one toanother Category (eg. Cat 3 to Cat 2) for the purposes of economic

treatment, it is not possible to then upgrade material at a later stage.

This applies also to downgrading SBP to Cat 3 or 2. It is therefore very

important to categorise material correctly if the maximum value is to

be extracted from it. This important distinction becomes clearer in

Chapters 4 and 5.

3.0.4. The Category of the ABP will determine permissible treatment

options. There is a range of possibilities but not every treatment op-

tion is available for all Categories of ABP. A summary of the ABP treat-

ment options is shown in Figure 8.

Figure 8: Processing options according to ABP Category

(Source: FABRA)

ABP processing Options ABP Category

1 2 3

Incineration/ Co-incineration

ABP processing Rendering

Compost or anaerobic digestion

(Category 2 ABP may be processed bycomposting or anaerobic digestion after

pre-processing)

Pet food (Raw)

3.0.5.The only common disposal processing options available (with-

out extra or pre-conditions) for all types of ABP are incineration/co-

incineration and rendering. Other treatment options that are availa-

ble for specific Categories of ABP are considered in Chapters 4 and 5.

Incineration and co-incineration (incineration with energy recovery)

of ABP are generally operated by specialist operators.

3.1 The Rendering Process

3.1.1. The modern rendering industry is illustrated diagrammati-

cally in Figure 9. Broadly, the basic principles are very simple. ABP

raw material contains both high levels of moisture (~ 70% on aver-

age) and microbial loading. The primary objective is to stabilise the

raw material, by heating it to more than 100oC, to effect an inacti-

vation or sterilisation of the microbes. Water is also evaporated and,

as a further consequence, the fat is separated or rendered from the

other solid components. After a further physical separation such as

centrifuging or expeller pressing, two products are produced: a high

protein meal and a liquid fat. Product terminology is important: ren-

dered animal fat may also be called tallow and the protein meal is

termed either meat and bone meal (MBM-produced from Category 1

or 2 ABP) or processed animal protein (PAP-produced from Category

3 ABP). More details surrounding the rendering process are availablein Woodgate & van der Veen (2004)3.

Raw ABP

Size reduction

Processing:Dehydration and

Sterilisation

SeparationWastewater

treatment

Filtration and QA

Storage

Product Despatch

Milling and QA

Storage

Product Despatch

Crude

rendered fat

Processed

Protein Meal

Processed animal

protein (PAP) or

Meat and Bone

Meal

Rendered Animal Fat

(Tallow)

Heat (steam)

Sized raw material

Processcondensate

Figure 9: Schematic diagram describing the rendering priocess

32004 Woodgate S L and J T van der Veen The use of fat processing and rendering in the European Union animal production industry in Biotechnology, Agronomy,Society and Environment, Vol 8 No 4, p283-294.


15/3715

3.1.2. In practice, according to FABRA, rendering accounts for >90%

of all ABPs treated in the UK, with other processes such as pet food

manufacture (Category 3 ABP only) taking up the rest.

Above: Rendering plants have to be approved by Defra/AHVLA in order

to operate.

Above: Rendered fallen stock and animal by-products Processed

Animal Protein (PAP).

Above: Rendered fallen stock and animal by-products ABP Category

3 rendered fat.

3.2 Volumes of ABP Processed in the UK

3.2.1. Total ABP rendered in the UK currently amounts to about 2.25

million tonnes, of which just over half is Category 3 material:

Total ABP by Category in 2010 (000 tonnes)

Category 1 ABP (includes any Category 2ABP) 1,100

Category 3 ABP (includes some Former Foodstufs) 1,150

Total ABP processed by Rendering 2,250

(NB. fallen stock accounts for about 5% of this volume)

The production of rendering derived products

in 2010 (000 tonnes):

Category 1 MBM: 300 Rendered Fat 155

Category 3 PAP: 275 Rendered Fat 200

3.3 The Basis for Payments by Renderers

3.3.1. The economics of collection and processing of all ABPs are

driven by the so called Gross Value (GV) of the raw material. The GV

is calculated by converting the value of the derived products (two in

the case of rendering) into the value of the raw material. This calcula-tion uses the yield of products produced and adding them up (see

illustrative example - source: FABRA).

Illustrative example

ASSUMPTIONS

(i) ABP X produces 25% protein meal and 15% rendered fat.

(ii) value of the protein meal = 100/tonne and rendered fat is

valued at 300/tonne.

(NB. this will vary significantly according to category of ABP

and the derived products produced.)

CALCULATION

The gross value of ABP X = (100 x 25/100) + (300 x 15/100) =

(25 + 45) or 70/tonne.

To calculate the value or charge made to the supplier (usually a

farmer), the following cost deductions are generally made:

Collection, Transport (ABP), Process (Storage), Transport

(derived product), and an element to cover renderers

overhead and profit.

The total sum of these amounts constitutes the Total

Processing Cost. In the example, if the total processing cost

is more than 70/tonne then the ABP will be charged for;

however, if the total is less than 70/ tonne then the material

will be paid for.

3.3.2. The main objective for all involved in this sector is to increase

the Gross Value to a maximum, by whatever means. This includes

R&D to effect regulatory change and thereafter add value by produc-

ing products of the highest monetary value, including improvements

to nutritional values if appropriate.

3.4 Regulatory Change

3.4.1. All treatment of ABPs whatever their original Category or in-

tended use is required to be approved under the ABP regulations. If

an intended treatment is not within the current regulation then an


16/3716

application must be made to gain approval. This is achieved by a pos-

itive vote in the EU Standing Committee on Food Chain and Animal

Health (SCoFCAH) following apositive opinion from European Food

Safety Authoritys Biohazard Panel. For further information see www.

efsa.europa.eu/en/panels/biohaz.htm

3.4.2. Processesor containment systems for ABPs may be approved

by amendments to the ABPR following initial assessment made by

Member States and the Opinion of EFSA. Dossiers from EU Member

States seeking EFSA opinions have been and are currently progress-

ing. It is important to recognise that the EFSA Biohazard Panel hasa consistent view on the very high safety standards that need to be

met, and are rigorous and independent in their assessments and

Opinions.

3.4.3. As an example of this, at present, the SRM list (Category 1 ABP)

includes bovine intestine. However, EFSA are currently considering

the removal of this organ from the definition of SRM, which will then

by default remove it from Category 1. If and when this step is final-

ised, the weight of SRM will reduce significantly and alter the propor-

tions of ABP processed as either Category 1 or Category 3.

3.5 Adding Value

3.5.1. The principles of adding value are clear but any steps taken

must be in accordance with the regulations. In a broad sense theGross Value potential for Category 3 ABP is higher than Category 1

ABP; so, any efforts to move Category 1 ABP into Category 3 ABP by

regulatory changes (eg. bovine intestine) will generally benefit the

value returned to the sector.

3.5.2. Carbon footprint work at Harper Adams University College

(Ramirez et al 2012) has revealed a renewable energy synergy be-

tween the processing of Category 1 ABP and Category 3 ABP. This

is because Category 1 derived products are used as carbon neutral

fuels that can be used to substitute for fossil fuels in the production

of Category 3 derived products. The use of these low carbon foot-

print derived products in subsequent finished products such as pet

food, animal feed or fertilisers can lead to a reduction of the carbon

footprint of these retail products. If carbon or carbon equivalentswere valued in economic terms, low carbon footprint products may

be able to realise significant economic advantages. (This issue could

usefully be explored more fully see suggested further research in

Chapter 5.)

3.5.3. Another example of potential economic benefit relates to the

preservation of raw material freshness and yield by cooling. This can

benefit both fallen stock and slaughter by-products. The returns may

be achieved in different ways: (i) by added yield (more product pro-

duced from the same amount of raw material); (ii) via increased quali-

ty that, in turn, leads to additional value for the derived products; and

(iii) environmental benefits accruing from fresher raw materials (due

to reductions in the cost of controlling the environmental impact

from processing, such as odour controls and effluent treatments).See Appendix 5 for more detailed information about the economic

impact of ABP freshness and quality parameters for rendering.

3.5.4. On-farm chiller units for storing fallen stock prior to collec-

tion are increasingly becoming a feature in Denmark, where users

are convinced that the capital cost of purchase and installation and

day to day running costs, are outweighed by the increased economic

benefits which are derived.

Above: A standard on-site chiller unit in operation in Denmark.

3.5.5. As there is no confirmed data to be able to conclude that

freshness or environmental conditions such as ambient tempera-

ture, storage and transport conditions do really affect yields of prod-

ucts from the rendering process, it would be valuable to initiate a

controlled study on this topic to see how this might apply in the UK

situation. Nevertheless, the Danish model provides a useful exam-

ple to quantify potential economic benefits for the UK. 6,700 (excl

VAT) capital outlay for equipment per farm is recovered in just 4 to 5

years via increased carcase value/reduced collection charges to thefarmer. (At about 200 per annum, running costs are low.) This means

that the net added value per annum after that repayment period is

about 1,500 per farm. Notwithstanding the need to research the ap-

plicability of the Danish arrangement in the UK4, when extrapolated

across, say, 5,000 livestock farms, the benefit could be worth some

7.5million per annum.

3.5.6.In addition to economic benefit at farm level, the outcome of

higher value carcases would also benefit fallen stock collectors (in-

cluding by reducing their own operational costs). Appendix 6 pro-

vides more information about the cooling unit in operation in Den-

mark.

3.5.7.The Fats and Protein Research Foundation (FPRF) based in theUSA is a research oriented organisation that covers a wide variety

of global research that includes work on ABP from slaughterhouses

(such as animal nutrition research for feed ingredients) and on non-

nutritional subjects (such as biofuels derived from fallen stock, for ex-

ample). A full description of the current work and an extensive library

of information and reports is available from FPRF (www.fprf.org).

3.5.8.Having looked at animal by-products in general, Chapters 4

and 5 look at the two different sources of animal by-product mate-

rial fallen stock from farms and animal products sent from Food

Business Operators (FBOs) - ie slaughterhouses, cutting plants and

retailers.

4Cooling, as an intermediary step in managing material of animal origin, falls within the scope of the ABP regulations; though installations on farm would need to beapproved by AHVLA.


17/3717

Chapter 4: Fallen Stock Disposal

4.0.1. Disposal of fallen stock is almost always a cost to the producer.

This is partly due to the collection costs (from farm to renderer) in-

volved but also because the end result is Category 1 or 2 material de-

pending on the Category of the ABP processed. There are opportuni-

ties for reducing costs to producers by improving the efficiency of

the collection process (eg. improved logistics, encouraging increased

competition etc.) through exploring ways of better storage on farm

and increased returns for the end product. Work is currently under-

way to explore the potential to store fallen stock on-farm in a waythat facilitates bioreduction of carcases, so that after a spell of stor-

age a smaller volume of net animal waste for off-farm disposal and

treatment is achieved at lower cost to the farmer see Appendix 8.

4.0.2. This multi-layered approach to managing fallen stock, when

taken as a whole package rather than considering individual ele-

ments in isolation, has the potential to increase the value of a re-

duced total volume, whereby all parties to the process benefit in-

cluding farmers, fallen stock collectors and renderers.

4.1 On-farm Disposal

4.1.1. The potential for on-farm uses of fallen stock material, such as

in anaerobic digestion for power generation, should always be kept

under review as technologies and techniques develop to provide abetter option than pure disposal. However, in the case of small ani-

mals, where volume of fallen stock may not be sufficient to supply an

alternative disposal route or justify capital investment in the neces-

sary on-farm infrastructure (eg. an anaerobic digester), it has been

suggested that on-farm burial or controlled composting of fallen

stock should be permitted.

On-Farm Carcase Composting

Carcase composting involves the biological decomposition of

carcases in organic matter under controlled conditions. The com-

posting process itself is aerobic, completed in two stages and takes

around 6 months to complete. In the primary stage, a high rate of bi-ological activity results in rapid composting and high temperatures.

This is where most of the organic breakdown occurs. The secondary

stage has lower biological activity resulting in slower composting

and lower temperatures, allowing the compost to complete the bio-

logical activity and stabilise, also called curing. Composting dead

pigs requires the addition of a carbon source (commonly sawdust)

to ensure that a proper carbon-nitrogen ratio is present for the com-

posting process.

Carcases are placed in specially erected bins (at least 2 are needed

for the two stages) and layered with sawdust until the bin is full. Car-

cases placed in the primary bin should be allowed to compost for

a minimum of three months before moving the contents to a sec-

ondary bin for the second phase of composting (for a further three

months, at least).After the secondary stage, the compost will be a dark, nearly black,

humus-like material with very little odour that can be used as a

fertiliser or for soil amendment. Some large resistant carcase parts

(teeth, skull, etc.) may still be identifiable but should be soft and eas-

ily crumbled after the process is finished.

While composting occurs naturally, the process requires proper con-

ditions to occur rapidly, minimise odour generation, and prevent

nuisance problems. This process is currently not approved for use

in the UK because of concerns related to disease spread by animals

scavenging for food. However, this has not been reported to be an

issue in Australia or the USA. A number of hurdles would have to

be overcome before this technique would be approved under EU

regulations (see Chapter 3.4).

5 www.defra.gov.uk/publications/les/pb13527-farm-reg-task-report.pdf

4.1.2. Although on-farm burial is currently illegal in the EU (except in

the case of the UK in remote parts of Scotland and one or two small is-

lands in England and Wales), scientific evidence is being re-examined

to look at whether the perceived harm to public and animal health

of such practice is not as acute as was believed when the regulations

were introduced. Last years Farming Regulation Task Force Report

(Striking a balance: reducing burdens; increasing responsibility;

earning recognition5) recommended that scientific evidence should

continue to be gathered and presented in support of a legal deroga-

tion allowing the burial of small farm animals on-site.

4.1.3. The Government is sympathetic. In its response of February

2012 to the Task Force recommendation, Defra agreed that farmers

should have greater choice when disposing of fallen stock than is

currently permitted by the EU Animal By-Products Regulations if it

can be demonstrated that the alternatives are safe. Specifically re-

lating to on-farm burial, Defra observed that the Department has

sponsored research into the risks from Transmissible Spongiform

Encephalopathies (TSE) transmission in the soil and results are ex-

pected later this year to help consideration of relaxation of the rules

banning burial of fallen stock. Defra intends to review the position

later this year as the evidence becomes available, to see if it is pos-

sible to make a case for seeking changes to the current EU controls.

4.2 Off-farm Disposal

4.2.1. Fallen stock disposal services are, of course, themselves sen-

sitive to the market principles of supply and demand. Such consid-

erations are reflected in the way collection and rendering sectors

structure themselves. As with on-farm use and disposal options,

the factors influencing off-farm arrangements may change in a way

that benefits the farmer. For example, as the value of post-rendering

product increases, so too does the economic justification for invest-

ing in new and more comprehensive fallen stock and ABP collection

arrangements, such as the creation of a greater number of central

collection points/centres, collectively offering a wider area of cover-

age/service than currently exists. However, these types of develop-

ments are consequential, depending on the successful emergence of

new uses and demands for ABPs.

4.2.2. Previous studies have been conducted into the structure of

the collection and disposal industries (eg. the 2008 MLC Report, As-

sessment of the Infrastructure for the Disposal of Fallen Stock in the

Eastern Region) and so has not been duplicated in this study. How-

ever, within the current structure of collection and disposal services,

it is useful to highlight examples of successful outcomes achieved by

others and also to identify best practice for the benefit of the wider

livestock production sectors generally. Such practice has developed

to help reduce producers costs, ensure producers and others in the

process comply with legal obligations, and to maintain a degree of

customer choice that ensures competition maintains downward

pressure on costs (either absolutely or via increased value to the

supply chain as a whole). Figure 10 offers a short description of howJockey Club Estates introduced arrangements that led to significant

cost savings:


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Figure 10: Case study taken from the horse racing industry

Case Study taken from the horseracing industry illustrating how

a simple but effective solution reduced costs and enhanced

benefits

Jockey Club Estates, based at Newmarket, has been running a

scheme to collect fallen horses since 1991. Before that, horses

were incinerated at a crematorium. Through an agreement

with a collector, carcases are removed twice weekly from a re-frigerated, Defra approved, store owned by the Animal Health

Trust. This arrangement has saved Jockey Club Estates between

30/40K or 15 to 20% on an annual turnover of 200k.

Two men are employed to provide a 24 hour, 365 day service

with biosecurity at the heart of what they do. Collection ranges

from high value animals with insurance issues through to indi-

vidually owned animals where some compassion is needed at

the point of collection. In the spring, they are very busy as the

breeding season brings forth the seasons new foals. Part of the

contract is to pick up placenta for disposal.

The service includes the removal and provision of parts (mostly

legs) to validate insurance claims, but also for research and CPD

at the major horse focused veterinary practices in the area.The scheme operates on a not for profit basis and its members/

sponsors include trainers/studs (automatic addition to the train-

ing ground fee) in the area (mostly East Anglia), Tattersalls, Race-

courses and Equine Vets, together with small private owners.

Costs for collection and rendering are about 100 per horse. A

rebate scheme operates if a horse is shot and goes to the hunt

(about 25). If the scheme has a good year, this is reflected in

the subscription the next year and by the same token, extra ex-

penses are covered in the same way.

4.3 Fallen Stock Collection and the National Fallen Stock Scheme

4.3.1. The National Fallen Stock Company (NFSCo) was set up in2004, as a not-for-profit company servicing the interests of livestock

sectors. NFSCo runs the National Fallen Stock Scheme (NFFS) which is

now used by over 47,800 livestock farmers across the UK. The Scheme

facilitates farmers access to a network of some 107 collectors, cover-

ing the whole of the countrys 800 postcode areas. Collectors offer

a reliable, efficient and competitive service. All premises approved

under the Animal By-Products Regulations are able to register as

collectors under the Scheme. Within the Scheme, NFSCo oversees

compliance with regulations and voluntary operating protocols (eg.

biosecurity), so that farmers can be safe in the knowledge that the

collection and disposal arrangements that they employ do not com-

promise their own obligations.

4.3.2. The National Fallen Stock Scheme is considered to be an ex-ample of best practice by many: it enjoys the full confidence of Gov-

ernment and delivers an efficient and effective service to its farmer

members and collectors alike. The main proof of this claim is that

Scheme users represent about 65-70% of livestock product across

the country, and do so out of choice. Further information about the

National Fallen Stock Scheme can be found at Appendix 7 and at

http://www.nfsco.co.uk.

4.4 Better Returns from the Rendered Product

4.4.1. Opportunities for obtaining better returns for the end product

of rendered fallen stock essentially come from research-based peer

reviewed papers demonstrating the safety of any particular process.

4.4.2. Proposals from the UK to EFSA have been made in the past,

some are currently being assessed and some are pending applica-

tion of the dossier (subject to completion of the scientific research).

In the UK, a Harper Adams University College project is looking at on-

farm storage and bio-reduction of pig carcase material by anaerobic

digestion. Results so far suggest effective pathogen control is achiev-

able. At Bangor University, research is assessing the possibilities of

aerobic bio-reduction of fallen sheep or pigs as a means of storage. A

recently published academic paper 6has concluded that bioreduc-

tion is efficient at containing pathogens from carcase material and

hence that the system could potentially be suitably secure to store

fallen stock prior to ultimate disposal. This may be of interest to the

poultry sector too. (For further information on these two projects, see

Appendix 8.)

Above: The bioreduction eld site at Henfaes, Bangor Universitys

research farm.

Above: Anaerobic digestion vessels used in the Harper experiments.

4.4.3. Another area where further research may be productive re-

lates to non-nutritional applications of ABPs. After the emergence of

BSE in Europe, North American research (mainly FPRF) began a con-

certed focus on non-nutritional applications for animal by-products.

An Animal Co-Products Research and Education Centre (ACREC)http://www.clemson.edu/public/acrec was established at Clemson

University in South Carolina USA. A wide range of studies have been

completed over the last 6 years, including potential uses of ABP

components in plastics and films, as fuel components and structural

materials. FPRF funded reports can also be found under directors di-

gest at the FPRF website. From a commercial standpoint, many of

the alternative uses have proven not to be as viable as hoped for.

Although some of the most promising products (plastics and films)

or processes (alternative biodiesel processes) have been able to gain

some interest, the cost of actually converting the raw ABP to a fin-

ished alternative product has proved to be too expensive or has not

been robustly evaluated to make a commercial investment decision.

Nonetheless, it will be important to follow developments at this Cen-

tre.

6Fate of pathogens in a simulated bioreduction system for livestock carcases. Waste Management 32, 933-938.Gwyther CL, Jones DL, Golyshin PN, Edwards-Jones G,

Williams AP (May 2012).


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4.5 Making Innovation Fit With the Rules

4.5.1.When pursuing market and technological development, it is of

course important to consider the extent to which new methodology

in processing and application of ABP products may be constrained

by existing regulatory tolerances, and the need to seek changes to

those tolerances. It is equally important for the proposer to comply

with any protocols and procedures laid down by relevant governing

authorities. This process can be challenging. For example, a proposal

to use a novel treatment method (instead of traditional rendering

and incineration methods) to produce a soil improver was recentlysubmitted to EFSA for an Opinion. The proposal suffered a set-back

because EFSA identified some shortcomings in relation to the appli-

cation. Further information about this case and lessons to be learned

from it is provided in Appendix 9, together with steps that could be

taken to mitigate the risk of repetition.

Chapter 5: Animal By-products from Food

Business Operators (FBOS)

5.0.1 Animal by-products from Food Business Operators (ie. slaugh-

terhouses, cutting plants and retail outlets) will normally be Category

3 material. In addition, some by-products or offal, that in the past

might have been considered as ABP, are now harvested as Edible Co-

products, demonstrating that over time increased values are being

achieved. This Chapter considers only the Category 3 ABP produced

at FBOs. (NB Any Category 1 or 2 ABP arising at FBOs will be subject

to the same requirements as the fallen stock material mentioned in

Chapter 4.)

5.1 Current Regulatory Change

5.1.1. The European Commissions TSE Roadmap7, published in July

2010, notes that the positive trend in the BSE epidemic has continued

since 2005, when the European Commissions first TSE Roadmap was

published and that the impact of BSE on human health appears to be

more limited than initially feared. The Commissions objective for the

coming years is to continue to review the TSE measures while assur-

ing a high level of food safety. Amendments to the TSE measures will

be stepwise and supported by scientific advice from the European

Food Safety Authority (EFSA). The Commissions initial priorities were

review of BSE testing and the feed ban.

5.1.2. On the latter, a major change to the regulatory framework

that can be expected to bring more value to the ABP sector is the

re-authorisation of processed animal protein (PAP) from abattoirs

for use in animal feeds. Specifically, the first phase will focus on the

use of non-ruminant PAP in feeds for non-ruminants (expected to

be limited to aquaculture species in the

Documents

A Creative Study Into the Scope for Increasing Value From Fallen Livestock and Animal by-products