Volume 13: Industry Processes and Controls
6. Rendering
Some features of the industry
Geography of UK rendering plants, their suppliers and customers

6.5 Some form of rendering industry has been in existence for centuries, producing tallow for candles and soap, and edible fat. During the Second World War, it was in the national interest that as much animal waste as possible should be processed and recycled in order to reduce food, feed and other imports. As noted in Chapter 7 under the heading 'The reason for widespread use of MBM in cattle diets', animal feedstuffs for young stock were required to include a minimum of 5 per cent by weight of animal-protein-rich substances such as MBM. ¹ The rendering industry was thus organised to produce this protein from slaughterhouse waste, and continued to do so after wartime restrictions were lifted in 1953.

6.6 From the 1960s, more efficient, high-volume 'continuous rendering' systems became available, gradually replacing many of the older-style 'batch processing' systems. The change took place over a number of years, continuing until the mid-1980s. Technological advances, stricter controls on effluent and odours, and higher energy costs all favoured larger, more efficient plant, as did the concentration of supply of slaughterhouse waste which resulted from the post-war restructuring of the slaughtering industry. About the only advantage of batch rendering systems over continuous rendering systems was their ability to process small amounts of waste economically. The other major change in the process was the phasing out of solvent extraction, which fell out of favour in the mid- to late 1970s. Continuous and batch processing and solvent extraction are described in more detail below, and in Annex B to this chapter.

6.7 By 1985, roughly half of the approximately 1.3 million tonnes or so of raw material processed annually was being dealt with in the 10 per cent of plants that had a normal weekly capacity in excess of 1,000 tonnes. ² The new, larger continuous rendering plants outpaced local supplies of raw materials. They had to look further afield, thus competing with other, less efficient renderers, not only for customers but also for this raw material. The number of rendering plants fell from about 120 in the 1960s, to around 100 in 1979 and roughly 70 in 1986. ³ Many firms closed, merged or were taken over.

6.8 By 1985 a single firm, Prosper De Mulder (PDM), and its subsidiaries, processed around 44 per cent of animal waste in Great Britain. ⁴ PDM had grown by taking over other firms. A report by the Monopolies and Mergers Commission (MMC) on the position in 1985 concluded that, although there was a monopoly in favour of PDM, this did not operate against the public interest. Nor did the MMC expect it to in future, because PDM performed an essential service effectively and reliably; it did so without undue pollution of the environment; and it was economically efficient. ⁵ The report did, however, recommend that an undertaking be obtained from PDM in relation to the pricing of certain future contracts to ensure that there was no exploitation of its monopoly position.

6.9 The concentration of the industry continued with further mergers taking place. By 1991 PDM's share of the market had grown to 55 per cent in Great Britain and 60 per cent in England and Wales. A second MMC report in that year concluded that a merger with Croda, which would add a further 5 per cent to PDM's market share in England and Wales, nonetheless did not operate against the public interest. ⁶ By 1992 PDM was processing about 64 per cent of the red meat waste in England and Wales and 80 per cent of the poultry waste. ⁷ At the same time, in Scotland, William Forrest and Son (Paisley) Ltd had about 71 per cent of the red meat waste supply. A third MMC report found that each had a monopoly and that there were some effects adverse to the public interest. ⁸ It recognised that animal waste collection and rendering 'constitutes a vital public service as well as a commercial activity', but made some recommendations intended to remedy the effect on competition of these firms' pricing policies.

6.10 In Northern Ireland there were two principal renderers: Lisburn Proteins, which used a batch cooker system, supplemented from 1984 by a wet rendering Atlas process, to deal with about 50,000 tonnes of raw material a year and Ulster Farm By-Products, which used a batch cooker system until 1983 and thereafter a continuous system (modified from dry to wet in 1984) to process about 38,000 tonnes a year. A third renderer Duncrue Food Processors, began processing in 1981 and used a batch cooker system. ⁹

Geography of UK rendering plants, their suppliers and customers

Location of rendering plants

6.11 Figure 6.1 shows the locations of the major rendering plants in Great Britain in 1993, indicating which were batch systems and which continuous. ¹⁰

Figure 6.1: Location of rendering plants in Great Britain, 1993

Sources of supply

6.12 Figure 6.2 shows for each of the twelve largest rendering plants in England and Wales what proportion of its animal waste supplies were obtained from within certain distance bands in 1993, excluding supplies delivered by independent contractors. Between them, these twelve slaughterhouses held approximately 91 per cent of the market in England and Wales at that time. Figure 6.3 shows similar statistics for all three renderers operating in Scotland in 1993. The Inquiry was unable to obtain equivalent figures for Northern Ireland.

6.13 In addition, the slaughterhouses supplying the renderers could sometimes take in animals from a wide area. For example, sheep regularly went from the South West of England to Scotland for slaughter. Thus it cannot be assumed that the MBM or tallow produced by a rendering plant necessarily came from local animals.

Figure 6.2: Sources of raw material for renderers in England and Wales, 1993

Source: Monopolies and Mergers Commission (M4 tab 3)

Figure 6.3: Sources of raw material for renderers in Scotland, 1993

Source: Monopolies and Mergers Commission (M4 tab 3)

Sales of MBM

6.14 Renderers sold most of their MBM to feed compounders, which were located throughout the UK. Smaller plants would sell more locally, but still up to a 200-mile radius.

6.15 Renderers also sold MBM to brokers and merchants. Brokers acted as middlemen, arranging purchases between renderers and buyers, without actually purchasing the MBM in their own right. Merchants, on the other hand, bought MBM on their own account and sold it on to their customers. Brokers and merchants sold mostly to animal feed manufacturers, but also to larger farms and distributors. The renderer was unlikely to know the final destination of the MBM, which could be some distance from the plant. ¹¹

6.16 Renderers sold only a very small proportion of total MBM directly to farmers, usually within 30 miles of the plant. ¹² Thus, generally, neither the cattle killed in a slaughterhouse supplying a renderer nor the customers of that renderer were necessarily located close to the rendering plant.

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¹ L3 tab 1B

² Animal Waste: A report on the supply of animal waste in Great Britain, p. 34 (M4 tab 1)

³ S33 Rogers para. 16

⁴ S37 Foxcroft p. 1

⁵ Animal Waste: A report on the supply of animal waste in Great Britain, April 1985, CM 9470 (M4 tab 1), pp. 88-100

⁶ Prosper De Mulder Ltd and Croda International plc: A report on the merger situation, August 1991, CM 1611 (M4 tab 2), pp. 1-2

⁷ Animal Waste: A report on the supply of animal waste in England and Wales and in Scotland, September 1993, Cm 2340 (M4 tab 3), pp. 1-2

⁸ M4 tab 3 pp. 121-2

⁹ M12 tab 4

¹⁰ Animal Waste: A report on the supply of animal waste in England and Wales and in Scotland, (M4 tab 3)

¹¹ T19 p. 60-3

¹² T19 p. 60-3