Beef Plan suggests pricing models to ‘protect survivability of producers’

On the second day of the talks between members of farm organisations and processor representatives, the Beef Plan Movement has made a number of suggestions in relation to pricing models, which the group says will “help protect the survivability of beef producers in Ireland”.

According to the movement, discussions on price per kilogram were not permitted; however, a Beef Plan Movement statement said that pricing models, in particular the beef grid, should be discussed.

“The Beef Plan Movement would like to put an agreement in place where the retailers, processors, traders and primary producers are all allocated a fair share of the retail price for their respective involvement in the beef supply chain,” the statement said.

The movement is calling for “an accredited economist” to devise a “fair distribution” of the retail cost, based on production costs of the various components of the supply chain.

Under the proposals put forward by the group, individual groups would have to agree to the percentage share of the retail price on an annual basis.

“It is up to these sectors to give a commitment to this new pricing model, as the current model no longer works for the primary producer,” said the Beef Plan Movement’s statement.

Quotes for producer organisations

The movement is also calling for a change in how factories quote producer organisations.

It is calling for these organisations to be quoted at 8c above the national average for each category of cattle, according to the preceding week’s prices from the Department of Agriculture, Food and the Marine.

This is because, as the group argues, producer organisations have costs to remain functioning effectively, and therefore, it believes, that cost should be factored into the quote to allow the groups to “remain sustainable”.

Short term

The above points relate to the Beef Plan Movement’s “long term” proposals, i.e., after February 2020.

However, the group also made suggestions on what it feels could be done in the short term – between now and February 2020.

The group said that, between now and then, there is an “estimated survival line of €4/kg for farmers”.

The Beef Plan Movement said that current prices are Brexit related, and that any further price pressure would “more than likely” be Brexit related.

Therefore, the Government and the EU have a responsibility to find whatever amount of money is the shortfall between the market price and the farmer survival line.

“The Beef Plan Movement believes that this money should be given to the factories and, in turn, the factories have to give a cast-iron guarantee that the money paid to farmers never drops below the survival line between now and February,” the group’s statement said.

The group stressed that, while it was its “goal” to get a sustainable price for farmers, it did not want it to result in rising costs for the consumer.

“Whatever responses and commitments are received today by the Beef Plan Movement, it will bring these responses back to their members for consultation. The outcome is reliant on ratification of today’s responses by Beef Plan Movement members,” the statement concluded.