Following figures published this week in the LMC Quarterly Bulletin, the Ulster Farmers’ Union is alarmed but not surprised that the average cost of suckler beef production in Northern Ireland is £3.82/kg.
UFU President Harry Sinclair said; “DARD have been tasked with calculating the average cost of suckler beef production and the figure published this week of £3.82/kg is staggering, particularly in the context of the prices paid for suckler origin cattle for the 2011/12 accounting year which were 70p/kg below the cost of production. It should be noted that this cost figure excludes any allowance for producers’ own labour, land or working capital, which makes the situation even more worrying and calls into question the survival of the suckler beef industry without immediate action from the supply chain.
“Our beef farmers continually strive to improve efficiencies on farm but have struggled with steadily rising production costs in conjunction with the impact of last year’s dismal grazing season and yet the supply chain continues to turn a blind eye and neglect its primary supply base. This cannot continue. Now is the time for our supply chain partners, the processors and retailers, to pull their heads out of the sand and wake up to the stark reality that their primary suckler beef supply is likely to disappear unless they start paying a fair price for the quality product our farmers are providing them.
"Time and time again we have told the processors face-to-face that farmers cannot continue to survive below the cost of production and that they are responsible for safeguarding their primary supply. This has simply fallen on deaf ears. Whilst prices have risen slowly in recent weeks, purely in response to supplies tightening, they have not gone far enough to tackling the problem. Meanwhile the ongoing price differential between Northern Ireland and Great Britain continues to frustrate producers. The UFU is actively engaging in the LMC price differential review and we hope it will provide the answers we need to tackle the issue and ensure fairness for beef farmers in Northern Ireland. Rectifying the differential may go some way towards alleviating the cost of production but more must be done.
Mr Sinclair Continued; “The retailers are often blamed for squeezing margins and actively seeking the cheapest product possible on behalf of consumers. However according to a recent Northern Ireland Consumer Council Report it would appear that consumers are voicing concerns about local farmers being unfairly treated by the supermarkets by not getting a fair deal. The retailers are often fond of championing the buzz word ‘sustainability’, which is ironic in the context of the treatment of their primary suppliers. The reality being that the supply of suckler beef is not sustainable at current farm gate prices. Rather than retailers paying lip service to caring for local farmers, now is the time for them to show it.
“We are therefore telling our supply chain partners to step up to the mark and revise their short termist strategies to take account of the costs incurred in primary production. No other industry or person would be expected to put in the long hours and hard labour, like our suckler beef farmers do, to work below the cost of production.
Harry Sinclair concluded; “If the situation continues the suckler beef industry has two options; either it will have to become heavily subsidised to maintain production or production will disappear. Neither is an appealing outcome. Suckler beef farmers simply want recognition from the market place of the quality product that they are producing. Surely that is not too much to ask for?”
