The unfair market practises within the beef processing sector need to be challenged rather than strengthened, Sinn Fein MEP Matt Carthy has said in response to an IFA-commissioned report on the ABP/Slaney deal.
The report found that should the proposed transaction poses a substantial lessening of competition in the Irish beef sector.
Carthy has said that the proposed merger would be a step in the wrong direction.
“This report confirms the concerns that I have repeatedly raised in both the European Parliament’s Agriculture Committee and with the Commission directly – that there is a clear unfair market dominance in the beef processing sector in Ireland preventing fair competition and fair pricing.
“It is by no means a far jump to conclude that the proposed merger would result in ABP/Slaney increasing significantly on their combined grip of the beef and sheep processing sectors beyond 26% and 40%.”
This merger would effectively isolate any remaining competitors and create a situation where it would be impossible for new meat processing businesses to enter the market.
Carthy said that in an area already suffering from extremely weak competition, farmers stand to lose our massively from this proposed merger.
Farmers have been expressing their concerns that the low prices they receive for their cattle is due to a de facto cartel being in operation, he said.
“It is clear to them that farm gate prices will decline further if the dominant players are allowed to tighten their grasp. With such low prices at the primary end of the beef and sheep supply chains, Irish farmers are at risk of being cheated out of what is owed to them for premium products on export markets.
“This merger would result in an unworkable concentration of the market in Ireland, allowing just a few key players to dictate the terms of processing and export by Irish farmers.
“The Irish government and the European Commission must work together to prevent it from going ahead.”