Processors must halt the decline in beef prices immediately

Friday, 9 August, 2013

The Ulster Farmers’ Union has called on beef processors to halt the decline in beef prices as a matter of urgency. UFU Beef and Lamb Policy Chairman Robert Davidson has branded the moves as “unjustifiable” and urged processors to start building confidence into the market if they have a genuine desire to see the industry grow and flourish.

Robert Davidson said; “Beef quotes fell again last week from 364-370p/kg to 360-362p/kg and there is absolutely no justifiable reason for this. Reports are that supplies of cattle coming forward for slaughter are still tight.  Indeed, the July kill was noted to be back 1.3% on the same period last year. Prices in Great Britain (GB) have come back slightly, hovering just below the £4/kg mark, however this is still substantially higher than the average prices paid in Northern Ireland and GB prices have definitely not come back to the same extent as they have here.
“There is no way that processors can justify this price slide and it must stop immediately.  Processors should be trying to build confidence in the market, especially if they have a genuine desire to grow and expand their businesses. If processors have truly bought into the Agri-Food Strategy Board (AFSB) Action Plan they should be working towards building a single supply chain that ensures profitability for all supply chain partners. The recent decline in prices would suggest otherwise and flies in the face of the AFSB Action Plan.”
The latest LMC Quarterly Bulletin strongly indicates that higher prices are indeed available and the UFU is urging producers to seek these out.

Robert Davidson continued; “If processors are going to pull prices, farmers should be shopping around for the best price for their beef and honing their bargaining skills as they negotiate for the best deal. Provided they are not closed with TB, they should consider whether exporting to GB could produce a more profitable outcome. In fact, exports to GB have increased substantially this year and have helped to create some competition in the home market.  Figures to date indicate that 8,663 cattle were exported to GB for direct slaughter which has almost surpassed the number of exports for the entire year of 2012 which totalled 8,983.  There has also been a large increase in the number of store cattle exported to GB this year.  This shows that there are opportunities in other markets for Northern Irish cattle which should be taken advantage of if possible.”