Factories say ‘high’ Irish beef prices are unsustainable
Current Irish beef prices have been labelled as ‘unsustainable’ by Meat Industry Ireland (MII) the body representing Irish meat factories.
In a statement which comes in the wake of CSO figures showing poor returns from the Irish beef industry from newly opened markets it said other continental markets remain weak and says Irish prices for finished cattle are at 110% of the EU average price.
It says this is way above their EU competitors and is not sustainable.
MII called on the Minister for Agriculture Simon Coveney to do ‘everything possible’ to secure this access and to also use the forthcoming Agricultural Council to seek an EU wide resolution to these market issues.
Latest CSO figures show that Irish beef exports to the US for the first six months of 2015 were only 31t with a value of €194,000 to the Irish economy.
MII has said it is also concerned about the weakening demand for beef products, especially across continental Europe, in part fuelled by the backlash from French importers.
In France, due to recent producer protests, the focus of retailers and food service operators on purchasing domestically produced product has left Irish exporters searching to find alternative market outlets where they are competing with other suppliers similarly locked out of the French market.
MII also says the chances of any increased access to the UK retail sector have diminished due the recent “buy British” market sentiment there too.
“In current market circumstances this creates challenges for processors when marketing beef into continental markets where cattle prices are well below those prevailing in Ireland.”
Furthermore, as other commentators have noted, store cattle prices in Ireland are particularly unreflective of the current beef market trends.
MII added that the continuing Russian embargo has also caused considerable international market disturbance, creating a more competitive environment there.
It says other EU exporters, locked out of Russia and who are seeking new markets have exacerbated this competition.
Meanwhile, MII says the trade in international markets, including Japan and the Philippines, has slowed and the recent economic turbulence in China is directly or indirectly impacting on world trade due to increased competition from other international exporters for their share of depressed volumes.
MII has also stressed that the EU Agriculture Council must take the opportunity to review meat markets in its discussions at the emergency meeting in September, in particular recent internal trade disruptions, the ongoing Russian embargo and the need for progress on international market access.
MII has reiterated that increased market access is crucial to minimise the effects of the weakened demand being experienced presently in many of our key markets.