Beef Plan Movement has raised concerns over recent comments made by the managing director of ABP International, Mark Goodman, in relation to the outlook for Irish beef exports to China.
The farm representative group is calling for clarity on the status of the Chinese market, urging that farmers need the information in order to make informed business decisions inside the farm gate.
In a statement to AgriLand yesterday, Tuesday, December 10, Goodman warned that, while total beef imports to China are forecast to hit a record 1.5 million tonnes this year, the demand for beef “has not matched” import volumes.
He says Chinese importers now find themselves with “too much stock” of beef and “huge cash-flow problems”. He cautions that importers are having to release beef onto the market “at any price”.
Last month, Bord Bia forecast that the Chinese market is expected to import between 25,000t and 30,000t of Irish beef – with a value of up to €120 million to the Irish beef sector – next year. Demand is coming on the back of China’s African swine fever (ASF) crisis.
However, Goodman is urging prudence on such projections.
“Irish packers and the wider farming supply base need to be very aware that the Chinese market is volatile and Irish beef has to compete with cheaper supplies from Brazil and Oceania.
Herd eligibility is also a limiting factor for Irish packers – factories are reporting that only 35-45% of their total weekly kill is China eligible. This is mainly due to TB restrictions written into the protocol.
“The Irish industry needs to proceed with extreme caution and slowly develop sustainable outlets with value-added offerings. This will take time.
“If the Irish beef industry gets into commodity trading round cuts and forequarters into China, it will end in disaster if/when the market falls,” he said.
But this evening, Wednesday, December 11, Beef Plan Movement has questioned Goodman’s remarks – particularly his assertion that “only 35-40%” of the Irish kill is eligible for export to China.
Goodman has said that the industry needs to ‘proceed with extreme caution’ – this completely contradicts Bord Bia and the department’s predictions that suggest that the beef exports will grow to €120 million by the end of 2020.
“Bord Bia’s chief executive has said that the Chinese market is ‘immense’ and that growth in demand is ‘constant’.
“The Minister for Agriculture, Michael Creed, has said that the Chinese market ‘will grow in volume and adds value for Irish exporters’ – which gives the best opportunity to give a return back to Irish farms.
“These statements are at odds with each other. Goodman’s comments do not reconcile with those of Bord Bia and the Minister for Agriculture.
“Yet they were all part of a recent trade delegation to China to ensure that contracts were achieved on behalf of Irish farmers and the tax payers of Ireland,” the statement outlined.
The movement has called for clarification on “this confusing information”.
Beef farmers need to be provided with the necessary information to be able to make clear business choices on whether to finish cattle or not.
“The current trade in stock in the marts with ABP feedlots and fat stock buyers does not concur with Goodman’s opinion.
“Another bruising spring of loss-making will devastate the beef industry. Real facts are required now – and leadership,” the statement concluded.