Beef prices at present are “driving farmers out of business”, according to Tim Cullinan, the president of the Irish Farmers’ Association (IFA).
He called on factories to give “an immediate price rise” to farmers, with the IFA outlining ’10 reasons why’ prices should be increased.
“The market has clearly improved, yet factories continue to try and hold back price… The factories need to increase prices immediately,” Cullinan argued.
The IFA’s ’10 reasons why’ beef prices should be increased are:
- Prices in the UK have increased by (the equivalent of) 44c/kg since April 25. In comparison, Irish prices have risen by 22c/kg;
- UK authorities report that UK steer price is at £3.68/kg, equivalent to €4.29/kg including VAT, and continues to rise. This is 48c/kg above the Irish price, which amounts to a price differential of €173 on an average steer;
- Cattle prices across the main EU markets are recovering, with retail sales continuing to show strong growth, and food services coming back as the Covid-19 restrictions ease;
- The Bord Bia prime export benchmark price has moved ahead of the Irish price over the last two weeks;
- Factory agents and procurement managers are very active, buying finished cattle in the marts and online, paying prices that are significantly above their quoted prices;
- Northern Ireland factories are very active south of the border, paying prices from 10c/kg to 20c/kg above Irish prices;
- The R3 steer price in Northern Ireland was £3.61/kg, equivalent to €4.20/kg;
- Northern Irish authorities reported that 785 cattle were exported live from the republic to the north for slaughter in the week ending June 21;
- Department of Agriculture data shows that, on May 1, there was a reduction of 83,000 in the number of beef cattle in the 12 to 24-month category, and a reduction of 10,000 in the 24 to 36-month category compared to 2019;
- Retail consumption figures for Ireland continue to show strong growth on beef sales.
According to Brendan Golden, the IFA’s national livestock chairperson, all market facts “point to a rising market”. He argued that it is “very clear” that factories can pay more.
Beef trade: ‘More bite’
For the most part, beef processors are now operating off a base of €3.60/kg for in-spec steers and heifers. However, there is “more bite” entering the trade and deals of €3.65/kg have been achieved by some farmers with suitable numbers.
While €3.60/kg is the common price on offer across the country, farmers with numbers of in-spec prime cattle, with a good factory-farmer relationship, are in poll position to achieve higher prices.
In related news, Turkish authorities have recently announced that the live imports of weanling cattle are set to resume in the coming weeks.
In 2019, nearly 9,000 weanling animals were exported from Ireland to Turkey, with the country offering an important live export destination for Irish cattle.