Meat Industry Ireland defends cattle prices amid criticism from IFA, ICMSA

Meat Industry Ireland has this morning defended the reduction in the price for cattle for the past weeks amid increasing criticism by the Irish Farmers Association (IFA) and the Irish Creamery Milk Supplier Association (ICMSA).

“The industry is operating in a very difficult trading environment. Irish cattle price is still almost 110 per cent of the EU average price. Our beef is 30-35c/kg more expensive than that in our key continental EU markets and this is having a serious impact on competitiveness and sales.  The reality is that for a major net exporter such as Ireland, it is not sustainable for our beef price to be so far ahead of the markets we are selling into,” said Cormac Healy, a spokesman for Meat Industry Ireland.

Meat Industry Ireland is the sector association responsible for representation of the business interests of the beef and lamb processing sector in Ireland. Its member companies are responsible for approximately 85 per cent of total beef and lamb processing and exports in Ireland, according to IBEC.

The spokesman continued: “While cattle prices are higher in Great Britain, it is important to remember that this is a price for their domestic cattle.  Domestic product will always receive a premium in the marketplace. Also, the current GB price is a reflection of their particular supply-demand situation at the moment, with their prime cattle kill down by more than 2 per cent year-to-date.  While the UK market is critical to Irish beef exports and this is reflected in the still very strong price paid for cattle in Ireland, it remains the case that the UK still only accounts for 50 per cent of our beef sales and therefore the full picture across all our European markets must be considered.”

Healy claimed the cattle price today is still 6-8 per cent higher than last year. “Furthermore, there is a significant bonus to be secured for QA in-spec cattle.  Some of this is being left behind unnecessarily.  It is worth 12c/kg and needs to be focussed on.  QA in-spec cattle will command the best prices for producers,” he added.

According to the ICMSA, the current strategy being adopted by meat processors of cutting prices when there is an ongoing shortage of beef in the UK and the Continent is extremely detrimental to the Irish beef sector and is undermining farmer’s ability to make a decent return from beef production.

On Friday Michael Guinan, chairperson of ICMSA’s Beef and Cattle Committee, said in the past number of weeks, factories have being playing a game with farmers by reducing quotes and making it difficult for farmers to get cattle killed.  “It is disgraceful that meats plants are simply taking advantage of their dominant position.”

Meanwhile IFA National Livestock Chairman Henry Burns hit out strongly at the meat factories accusing them of imposing serious income damage of livestock farmers with their unjustified price cutting tactics.

“The factories have pulled prices by 30c/kg or €110 per in the past few weeks,” he claimed. “Over the national kill of 1.5 million cattle, this magnitude of price cut would amount to €165m out of farmers’ pockets in a full year,” the IFA chairman added.

According to the latest IFA Cattle Price Index, 17 July, there is a massive beef shortage in UK, price solid at up to equivalent of E5.00/kg. Supplies of In spec cattle extremely tight.  Factories paying 10c/kg above quotes. Steer base €4.20/4.30/kg. Heifer base €4.35/4.45/kg. Young Bulls up to E4.25/4.30/kg. Cows €3.10/3.70/kg. In spec bonus 12c/kg on top of base prices. The Index is based on prices reported as quoted or paid to IFA members.

Image Sales Ring/ O’Gorman Photography

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