Beef industry on the brink
Friday, 30 May, 2014
Following reports that beef prices have fallen again this week, the Ulster Farmers’ Union has expressed its serious concern for the future of Northern Ireland’s beef farmers.
UFU Beef and Lamb Policy Committee Chair Robert Davidson; “The current beef price is completely unsustainable and this continued volatility is making it exceptionally difficult for farmers to plan for the future. Farmers are very angry, there seems to be a complete lack of understanding from retailers and processors that rearing beef cattle is a long term business. Farmers cannot be expected to turn on a dime in order to meet new specifications or requirements and they certainly should not be penalised when they are given no time to adapt their businesses to changes.
“Sadly, beef farmers have absolutely no confidence in the current market at the moment. Indeed many are questioning the sustainability of the sector and even their future in it. The recent action of the meat plants have done little to help the situation or encourage farmers to stay in the industry. NI farmers are producing a high quality, fully traceable product to rival the best in the world and they should be paid accordingly.
“Following the horsemeat scandal many of the major retailers made commitments about working closely with farmers but we are seeing little evidence of this actually happening. In fact, at a time when farmers are facing declining farm gate prices the average margin taken after the farm gate has risen from a long term average of £2.76/kg to an average in the first four months of 2014 of £3.38/kg. It is completely unacceptable that retailers and processors are boosting their profit margins on beef products while farmers are squeezed and the UFU is calling on all involved to reverse this trend.
“Also, recent statistics are showing worrying trends with beef cow numbers declining by 6% in 2013 and the beef sired calf births have reduced by 10% in the first quarter of 2014 compared to 2013. Retailers and processors need to take a long term view and not just focus on short term profits. There is a very real possibility that the Northern Irish beef industry could be at risk of losing its share in the market place altogether. The wider NI economy relies heavily on the red meat sector to provide employment in the processing and food service industry, but without local beef farmers some of these jobs could be in jeopardy and any plans to grow the sector will certainly not be realised. We need to reverse the current trends and grow the sector so that we can take advantage of export opportunities which will continue to open up as global demand for food grows.”
The UFU is in the process of organising discussions for next week with its UK and Irish Union counterparts to discuss the current market situation further as well as what actions can be taken together.
Margin figures from here.