Agriculture Minister, Simon Coveney, met with the Irish Farmers Association (IFA) yesterday and discussed at length the issue of Irish beef prices, in particular current bull beef prices, and he is set to meet with the CEOs of Ireland’s main meat processors later this week.
Speaking in the Dail yesterday, the minister outlined aggregate cattle supplies at department-approved meat plants to early February 2014 were up seven per cent on the corresponding period in 2013, with strong increases recorded in the steer, heifer and cull cow categories.
“This higher throughput has led to factories giving preference to certain types of stock that are better suited to the requirements of their retail customers,” he said.
The minister acknowledged prices for prime steers and heifers have remained relatively stable but the young bull trade is challenging at present as age and weight issues continue to affect demand.
“However, I note that the young bull kill increased by 60 per cent between week one and week six of 2014. The Irish beef sector is hugely dependent on exports and needs to ensure that it is producing efficiently for overseas markets,” he stressed.
According to the minister, one of the main difficulties in marketing young bulls older than 16 months is that these animals are outside the specifications preferred by the UK market.
“This is a major disadvantage at present because the UK market has effectively become the highest-priced beef market in the EU and it is where we sell most of our beef,” he said.
Again the minister stressed the Government will not intervene in this market.
“Delays in young bull slaughtering undoubtedly put pressure on producer profit margins but neither I nor any Agriculture Minister can interfere in a trade that is cyclical in nature and prone to short-term price fluctuations. Of course, I am entirely sympathetic to those farmers facing difficulties in getting their cattle slaughtered at a price that will allow them any margin at all,” he said.
The minister also informed the Dail he is to ask the CEOs of the meat companies concerned to come into the Agriculture Department to have a “blunt conversation” to find a way forward that farmers can accept as fair and that factories can maintain an acceptable margin on. This is set to happen later this week.
The minister added: “It is the responsibility of the industry, in the first instance, processors and farmers working together, to manage the type and volume of cattle being brought to market so that the supply chain operates for the benefit of both parties and does not undermine the viability of bull beef production systems for either winter finishers or suckler farmers. I understand that producer and meat processor representatives have recently engaged in dialogue with some initial progress being made, but I can vouch for the fact that there is much more progress required in this area.”
In addition, the minister stressed the importance of Ireland’s export market to the sector.
“Last year we got Japan, Lebanon and the Gulf states open. We got live exports to North Africa, which is a difficult market to manage. Even today, I spent half my meeting with the Chinese ambassador talking about beef access into China. In addition, we are pushing to get access into both the US and Canada this year. We are expanding the spread of beef markets that we can access and we have a mature and street-wise group of companies that can take advantage when those markets open.”