Processors refute drought beef price pull

Processors have come out in defence of recent cuts to the beef price, after they were accused of “taking advantage” of the drought conditions over the past four weeks.

In a statement released today, Cormac Healy – senior director with Meat Industry Ireland – said that official reported prices by the Department of Agriculture, Food and the Marine show that cattle prices have weakened around this time of year in three of the last four years.

Commenting on the situation, he added: “These trends are market related and any suggestions that the recent price falls are due to processors taking advantage of drought conditions are simply wrong and unjustified.

Everyone is acutely aware and understanding of the challenges at farm level at present, but laying the blame at the processors’ door is misguided.

“From a market perspective, exporters report that there is strong competition for beef from lower priced meat proteins.

“Also, while demand for manufacturing beef remains stable – reflecting positive burger sales – the exceptionally warm weather has affected demand for steaks, with prices for certain steak cuts back 10% in the last three weeks alone and returns from the fifth quarter and hides remain under significant pressure,” the senior director said.

‘110% of the EU average’

Continuing, Healy stated that the latest European Commission beef price report shows the overall all-categories price paid to Irish farmers for cattle is 110% of the EU average.

The overall Irish cattle price is third highest in the EU, only behind prices in the UK and Sweden – both deficit markets for beef.

“Current price levels in Ireland remain high, when compared to prevailing prices across our key EU export markets and coming on the back of a positive cattle price trend over the year to date – up €35/head.

“This represents a very strong performance by the Irish beef processing industry in terms of the price returned to Irish cattle producers,” he concluded.

‘Unnecessary price rot’

This statement comes in the wake of comments made by the president of the Irish Farmers’ Association (IFA), Joe Healy, earlier this week.

He called on factories to stop cutting prices and undermining the beef market, adding that they are taking advantage of the drought conditions.

The president claimed that factories have cut 20c/kg off the price over the last four weeks.

Healy urged the Minister for Agriculture, Food and the Marine, Michael Creed, to call on the factories to halt the “unnecessary price rot”.

He added that the minister has worked hard on market access for the factories and that he cannot allow them to throw all of that back in his face “with unjustified price cuts”.