Beef prices have improved this week but farmers should also be aware that “indirect price cuts” could have an impact on final prices, according to the Irish Creamery Milk Suppliers’ Association (ICMSA).
This week’s factory quotes for finished beef cattle show that beef prices are improving but ICMSA livestock chair, Des Morrison, said while the improvement is welcome there are number of issues still impacting farmers.
Cattle prices had been on a declining trend throughout July and into the first half of August. The latter part of August saw price cuts stall as price quotes began to increase again last week.
Morrison said while this price rise is overdue there continues to be some incidents of farmers experiencing difficulties with some processors.
“It is encouraging to see that beef prices are improving but they are still much lower than earlier this year and these reductions will have a very severe impact on beef farmer incomes in 2023.
“Meat processors continue to impose cuts indirectly based on specifications and grids that are applied at different levels and rates depending on the level of cattle supplies and factories’ requirements at a specific time,” Morrison said.
According to the ICMSA livestock chair feedback from the organisation’s members across the country highlights that the same “complaints” are coming through time and time again.
He said that farmers have said these include:
- Factories “overly fussy” application of the grid meaning that farmers are being penalised for over and under fat cattle;
- Certain factories are re-imposing weight limits above 420kg;
- Factories have dropped flat pricing;
- Breed bonuses have also been reduced in some cases;
- Age limits are being applied in a stricter manner.
According to the ICMSA livestock chair, the net effect of these actions amounted to indirect but substantial cuts to beef prices.
Morrison said that farmers need to know exactly what they are likely to receive for their cattle, and need to get “very clear and unambiguous quotes” from their meat processor before sending cattle.
He explained they should clarify the position in relation to weights, conformation and fat scores, breed bonuses, age and quality assurance bonuses. He added that farmers should “shop around” for quotes.
“All this takes time, but it could be well worth it in terms of the final value received for your animals that you have bred and reared for a number of years,” Morrison added.