Factories and feedlots: Farmers ‘have no faith’ in competition authority

Competition – or lack thereof – in the beef industry was a key theme for three farming organisations which were before the Oireachtas Joint Committee on Agriculture, Food and the Marine to discuss the future of the sector.

Meeting before the committee earlier this evening, Tuesday, April 9, representatives from the Irish Farmers’ Association (IFA), the Irish Creamery Milk Suppliers’ Association (ICMSA) and the Irish Natura and Hill Farmers’ Association (INHFA) voiced their concerns regarding the lack of competition in the sector, among other topics.

The IFA raised question marks over the competition regulatory authorities, with IFA president Joe Healy outlining what his organisation thinks of the Competition and Consumer Protection Commission (CCPC).

“We’ve no faith in the CCPC; we said that in their presence here.

They very clearly said themselves when it came to the UTPs [unfair trading practices] and the legislation that they were only interested in the consumer and they weren’t interested in the producer.

“So how could you have [faith]. But long before that we had no faith in them.

“So definitely, we want an independent regulator to ensure that the findings of the report are carried through. Because the producer has to have faith in it from the start.”

IFA livestock director Kevin Kinsella noted that the organisation had submitted a “very detailed, comprehensive” 105-page submission to the competitions authority at the time on the beef industry.

“One of the responses from the CCPC at that time was ‘can you go back and talk to the Minister for Agriculture and the Minister for Business and Enterprise and ask them can they prioritise the competition area in terms of the beef processing sector’. That’s what was said to the IFA at the time.

“We communicated that to the relevant ministers involved at that particular time.”

‘Santa’s elves’

ICMSA president Pat McCormack raised concerns surrounding the influence of feedlots on dampening beef price and distorting competition, referencing how 54,000 cattle slaughtered in January and February originated from factory feedlots.

However, McCormack added that this does not take into account the cattle controlled by agents for factories, which he described as being akin to “Santa’s elves”.

“We’d be talking about Santa Claus, his elves and the reindeers. That’s what the agents are – they’re part and parcel of the meat processing industry.

There is a register of cattle hauliers out there; there’s also a register of cattle agents – so I don’t think it would be very difficult for someone with more influence than myself to come up with the list of agents, their herd numbers, and how many cattle they’re sending into the factory.

“Because we’ve quoted the figure of 54,000 to you for January and February; and my belief is the cattle under the control of the agents are probably double that. And where are the factories keeping the cattle?

“They’re keeping them in farmyards where family farms made a living in the past; found themselves not profit making; found themselves in a position where cash-flow was getting tighter and tighter, and not in a position to restock and gamble.

“And ultimately they’re going out in the morning and they’re working now for the processor, feeding the cattle,” the ICMSA president said.

‘Bring in legislation to stop processors having feedlots’

INHFA director of operations Vincent Roddy commented on the 30-month rule and four-movement rule, calling for both rules to be abolished.

“I don’t know why it was introduced; but there’s no logic to keeping it there. At this point we could get caught up in why it was introduced. Our point would be look, let’s get rid of it, there’s no reason for it. And it’s definitely being used to deflate the price of cattle and especially in the marts for farmers.

Both the 30-month rule and the four-movement rule are being used against farmers that are moving on cattle.

“Feedlots are definitely impacting – and everyone else has concurred in here – feedlots are impacting on the price and it’s being used to manage and deflate price.

“And I do think that we have the option – the Oireachtas does have the option – to actually bring in legislation to stop processors having feedlots. It’s that simple. I’d be fairly confident that whoever’s buying cattle needs herd numbers so that needs to be looked at.”