The Irish Beef and Lamb Association (IBLA) has said “it is time” for meat processers to offer forward supply contracts to Irish sheep farmers.
This call comes during a time in which the IBLA “welcomes the price increase in sheep markets”, but is aware of the “spiralling costs on sheep farms in the last few years”.
The IBLA has said: “It is very difficult for farmers not to lose money in their sheep production systems.
“It is now time for meat processors to start to engage with farmers and offer forward supply contracts for their products, so they can make sure they have a guaranteed supply of product going forward.”
The necessity of forward supply contracts comes at a time when the IBLA has said small farmers are exiting the industry, fewer young farmers are going into farming “due to the high cost of production” and that other farmers are “keeping minimum stocking numbers just to claim their farm payments”.
“Forward contracts would bring more stability to the market and certainty to those farmers, who carry all the financial risk when producing their products,” the IBLA added.
Forward contracts
The IBLA explained it is aware that, through engaging with retailers, 24-month contracts are offered to the meat processors.
It added that “there is no reason for processors not to offer forward contracts to farmers” and that “there are very few industries nowadays working without a contract in place.
“IBLA has been trying to engage with meat processors for these reasons and indeed other issues in the meat industry but the processors are not willing to engage.”
The farm organisation highlighted that there will be “more financial problems” coming up for farmers, and that such problems “may lead to more farmers going out of business”.
The IBLA has called upon the government to bring processors, retailers, farm organisation’s and Bord Bia into “a new forum so that farmers can secure forward contracts”.
The organisation has also called upon Bord Bia to record shelf prices from the retailers across the countries that Irish food is exported to.
More engagement is needed with “consumers on the products that they are looking to consume to bring about more food security going forward,” the IBLA has added.