It’s time for some radical thinking within the livestock sector
Who does the IFA think it’s kidding? The 48 hours of ‘grandstanding’ activity is nothing more than an optic operation, planned to take livestock farmers’ minds off the real challenges that lie ahead.
The world and its aunt already know that beef prices will strengthen over the coming weeks and into the New Year. The Minister for Agriculture, Food and the Marine Simon Coveney said as much when he was in China last week and, prior to this, IFA President Eddie Downey had said publicaly that a shortfall in cattle numbers at the tail end of 2014 would have the factories reaching for their cheque books.
So, no doubt, we will see the IFA taking the credit for a rise in beef prices that was going to happen anyway. I can see the Christmas/New Year messages emanating from the Farm Centre in my mind’s eye already.
But take the veneer of the recent protests away and the reality of what the IFA has really done for Irish beef farmers over the past 12 months does not stand up that well to scrutiny. In the first instance, the organisation signed up to a new CAP deal that does precious little for beef finishers. In fact, the final agreement has more holes in it than my mother’s old baking sieve.
The stark reality is that beef finishers in Ireland will lose out under the new Pillar 1 arrangements because of their relatively-high stocking density. And, then, there is the challenge of market volatility which is going to play havoc with cash flows across all sectors, that and the inexorable rise in all input costs. At least the dairy industry is actively addressing the merit of introducing price based contracts, linking farmgate returns and input costs.
It goes without saying that the supermarkets are the real villains. But what’s the point in demonstrating outside Irish retail outlets when the guys causing the real problems sit in board rooms in the UK and further afield?
According to a recent Rabobank report on the global beef sector, EU retailers are currently maintaining prices at artificially low levels. And, of course, the man who can sort this issue out is the EU’s new Agriculture Commissioner Phil Hogan. He has already made it clear that he is minded to introduce a supermarket ombudsman, someone with real power and influence to bring the supermarkets to book.
What’s required now is the development of a strategy for Irish beef that will put the industry on to a sustainable footing. And, in this context, protesting outside meat plants just doesn’t cut it. We need to look at a fundamental review of the support measures made available to the beef sector. One option would be to remove all full-time beef finishers from the area-based, Pillar 1, payment system altogether and make these monies available to support a weekly guide prices for heifer and steers.
Under the aegis of the Beef Variable Premium Scheme, this system of market support had been the norm in the UK up to the mid 1990s. And I don’t see why it couldn’t work in Ireland now, provided we got the guarantee of a supermarket ombudsman who would ensure that retailers throughout the EU paid a genuine price for beef, week-in: week-out.
But the fundamental bottom line is that we need new thinking brought to bear in the context of how best the Irish beef industry is made fit for purpose. And the IFA stands accused of not meeting this requirement over the past 12 months.