'Farmers should avoid exposure to payment risk when selling livestock'

Farmers should avoid exposure to payment risk when selling livestock, according to the Irish Farmers’ Association’s (IFA’s) National Livestock Chairman, Angus Woods.

Woods believes that the security for farmers selling livestock is “absolutely critical” and he he advised farmers to avoid exposure to payment risk.

By selling livestock in their local mart, farmers can ensure security of payment – as well as open market competition and the top prices available, Woods said.

According to the IFA’s National Livestock Chairman, farmers should insist on payment on the day for all other sales. These include sales to factories, sales to live exporters or farm-to-farm sales, he added.

With the likes of electronic banking and the use of bank drafts, farmers can minimise the level of exposure to payment risks.

Rising insurance premiums

However, Sinn Fein TD, Pearse Doherty, claimed earlier this year that some local marts are facing increasing pressure from rising insurance premiums.

On June 4, Doherty told the Dail that livestock marts in Co. Donegal were coming under “increasing financial pressures as a direct result of what is fast becoming the cross-sectoral problem of insurance costs”.

Doherty was reportedly contacted by a number of representatives from marts in his area, who highlighted that the “crippling costs” are forcing mart operators to seriously consider their own futures.

These increased costs were attributed to rising mart insurance premiums in recent years.

But the Minister of State at the Department of Finance, Michael D’Arcy, said that he had been advised by Insurance Ireland that livestock marts have significant exposure to injuries to both employees and members of the public.

“This has resulted in claims occurring with a level of frequency which has led to a reduction in market capacity due to the hazardous nature of the risk.

In response, insurers have developed active, risk-management programmes in order to try to reduce the level of accidents and injuries.

“In addition, I understand that insurers have been working with marts with a view to implementing improvements in management practices and facilities to reduce claims – as this is the key area in terms of managing claim costs,” he concluded.