Beef finishers are losing out on approximately €3.7 million per week for cattle compared to the pre-Brexit period, according to an analysis from the Irish Cattle and Sheep Farmers’ Association (ICSA).
In an interview with AgriLand, Eddie Punch, the general secretary of the ICSA, outlined how his number crunching has revealed a significant disparity between farm-gate receipts in 2019 versus 2015 – the year before the UK held its Brexit referendum on June 23, 2016.
Although the UK has not yet officially vacated the European Union, and the terms of its departure – whether it be a ‘soft exit’ or a ‘hard exit’ – remain unclear, Punch states that for Irish beef finishers, Brexit has “already happened“.
“Roughly speaking what we did was we looked at the average price in 2019 and compared it with the average price in 2015.
For prime beef, steers are making about €3.66/kg this year versus €4.10/kg in 2015. Heifers are making €3.79/kg in 2019 versus €4.15/kg in 2015; and young bulls are making €3.57/kg versus €4.00/kg in 2015.
“Obviously there is a lot of variation in this, but that is the average figure,” he said.
According to Punch, the 2019 weekly throughput in steers is approximately 11,200 head; heifers is approximately 10,500 head; and young bulls stands at an estimated 5,700 head.
“When you multiply that out by an average carcass weight you get about €150/head down on steers; about €100/head down on heifers; and about €150/head down on bulls – ballpark.
“That works out at around €3.7 million a week being lost by farmers; that’s the difference in the price for 2019, compared to 2015 – which is the pre-Brexit period.”
Cow figures are also not included in the above analysis.
‘Brexit has already happened’
Punch highlights the impact that this blow on cattle prices is having on rural economies throughout the country.
“If we were getting 2015 prices, we’d have €3.7 million more every week going into rural economies. That’s reduced receipts going into farms, reduced output value on beef farms and all that obviously feeds back onto the suckler farmer.
If we keep going the way things are, we are heading for potentially near enough to €200 million of reduced receipts in 2019 – if it stays at that rate for the year.
In light of these stark figures, the ICSA representative stresses that, in the case of a no-deal, crash-out Brexit, the EU’s emergency support package for Ireland – the detail of which still has not been made known by the Government – should be focused on “getting money to those already hit”.
“The rescue package has got to be focused on getting money for people that have already been hit so far in 2019.
Also Read: Creed on Brexit: ‘The immediate impact will be on beef finishers’“It has to go back to the beef finishers because they are the people that have had the hugely reduced price – in practice, suckler farmers have lost as well.
The beef sector is really carrying the price of Brexit.
“There is massive talk – and I’m actually alarmed by this – that people speak about ‘if there is a no-deal Brexit’ and the assumption is that Brexit hasn’t impacted yet.
“Every sentence that you read from the European Commission and the Government here says ‘in the event of a no-deal Brexit, in the event of a no-deal Brexit’ – that is a ‘get-out-of-jail’ clause.
Brexit has already had a massive impact on the beef sector. Yes, it matters whether there is a deal or not, but regardless the price has already been decimated.
“I’m concerned about how much will be in the support package. I think we have to be absolutely resolute in fighting for it.
“The money has to come out of somewhere that is not the CAP [Common Agricultural Policy] budget because that is only moving deck chairs – it has to be found somewhere else.”
Tea leaves
Reading “between the tea leaves”, Punch believes the EU and the Irish Government are “confident” that a withdrawal deal will be agreed.
“It’s looking pretty like they’ll go for a ‘Common Market 2.0‘ arrangement, which is a Norway-style deal, or they’ll go for a customs union with a lot of alignment on the single market.
That’s almost there now because UK Prime Minister Theresa May realises that she will never get the DUP or the hard-line Brexiteers on board.
“There are some people in the DUP, and the extreme end of the Tories, who do not understand that all politics is compromise.
“The majority in the house is edging towards one of those two things – a customs unions with a lot of alignment with the single market, or ‘the full monty’,” he concluded.