THE sheep industry has a bright future with plenty of opportunities - but it is vital that the Government announces its decision on the mid-term CAP reform as soon as possible.

"There is going to be reform. It is going to happen," said Peter Morris, policy executive with the National Sheep Association. "What we do not know at this stage is how it is going to happen."

He was speaking at the fair, which attracted hundreds of farmers from the North of England and Southern Scotland to Hexham mart on Thursday of last week.

It was, said Mr Morris, the quiet before the storm. "The devil will be in the detail. We are sitting in a vacuum of knowledge. It is damaging the industry and hitting confidence."

Farmers were trying to make business decisions without knowing how the single farm payment scheme would be implemented. He believed there would be further consultation in the next few weeks and it was vital that the industry should be united and strong "so that we come across as a strong and powerful voice to get what is best for you".

He stressed his belief that a bright future lay ahead. EU lamb production had fallen by 50pc since 1992 but consumption had not dropped, and the EU had become a net importer.

UK average consumption was 6.5kg per person compared with the EU average of 3kg and the new member states' 1kg. "Surely that has to have potential; as their standard of living increases their demand for better quality will increase," said Mr Morris. "The UK is best placed to take advantage of that.

"There is ample growth potential in the EU market and we have to exploit it to the best advantage. We have every reason to be positive. Traditional markets should continue to be strong and the UK produces a quality product that is in demand at home and abroad."

He highlighted France, which could not wait to import UK lamb once the foot-and-mouth crisis was over, they had missed the quality so much. Up to 30pc of lamb production was exported, with France the chief buyer.

"We do have the potential to develop our product and we have a vital role for the English Beef and Lamb Executive and Quality Meat Scotland," said Mr Morris. "The industry really has to get behind them."

Although it was still the older consumer who tended to buy lamb, it should be possible to come up with cuts which would appeal to the younger buyer looking for convenience.

Sheep were also an excellent cross compliance tool. "We should recognise their value, particularly in the uplands, and the fact that they are the best, most cost-effective environmental managers we could have," he said.

However, one farmer commented that environmental restrictions had resulted in a remarkable reduction in the number of sheep in the hills, with large and tall areas of bracken re-appearing.

Two separate 1,000-acre fires had occurred near his farm this summer. The loss of moorland affected grouse, which were also losing hundreds of young to re-introduced hen harriers.

"If this is the way the industry is going it is time to point out the failings," he said. "We must get back to recognising the value of the grazing of sheep and periodic burning."

Mr Morris agreed. He blamed environmental restrictions for large areas of tall gorse and bracken returning to Dartmoor, close to where he farms. "We now hear that undergrazing is a problem and that is the environmentalists' fault," he added.

He ended by saying it was important to attract young people to be the shepherds of the future