With beef prices in our major export market in the UK increasing strongly by over €100 per head since July, the Irish factories clearly have scope for significant lifts in prices here according to IFA President Eddie Downey.
He said the rise in UK prices must be reflected by the factories in immediate price increases to farmers to start narrowing the excessive gap between Irish and UK prices.
Eddie Downey said after a dreadful year for beef producers, market factors are finally moving in farmers’ favour. In addition, he said cattle supplies are set to tighten by 150,000 head over the next 12 months, due to an increase in live exports and lower registrations in 2013. He said prices are moving with factories having to pay 5c to 10c per kg above quotes prices to get stock this week.
Eddie Downey said prices are going to have to increase significantly to cover the costs of production and leave a margin for farmers. In addition, he said the Minister for Agriculture Simon Coveney has to get involved centre stage in resolving the issues around the difficulties in the beef sector with the factories.
The IFA Livestock Chairman Henry Burns said with an additional 126,000 cattle already processed this year and an additional 30,000 animals exported live, the supply of finished cattle to meet increased market demand was tightening and factories agents were actively chasing cattle and offering farmers more to get supplies this week. He said the AIMS data is pointing to a reduction of 150,000 head in finished cattle supplies over the next year.
Henry Burns said the key issues that are causing severe financial hardship for livestock farmers are the application by factories of unacceptable and unjustifiable price and spec cuts for weight and age in the Quality Payment System (QPS). “These price penalties were not part of the original QPS and are being used as a tool to devalue livestock.”
On removing the roadblocks impeding the live export trade to Northern Ireland, Henry Burns said the beef branding concept being pushed by the IFA specifically for cattle born in the ROI and slaughtered in Northern Ireland is progressing, but needs the full backing of the Ministers for Agriculture both North and South. He said Tesco has confirmed to IFA they have now received the relevant documentation from the Northern Ireland authorities and DEFRA.