Business Farming

Tuesday 27 September 2016

IFA demand action on processors deal

Protest highlights 'lack of competition' in beef sector as ABP moves for 50pc stake in Slaney Foods

Published 09/02/2016 | 02:30

IFA members brave the conditions to protest outside the Slaney Meats factory in Wexford last Sunday. Photo: Finbarr O'Rourke.
IFA members brave the conditions to protest outside the Slaney Meats factory in Wexford last Sunday. Photo: Finbarr O'Rourke.

Farmers are calling on Agriculture Minister Simon Coveney to step in to tackle competition issues in the beef sector as concerns mount over a move by Larry Goodman's ABP to take a 50pc stake in Slaney Foods.

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Farmers from all over the country gathered outside Slaney Meats in Bunclody, Co Wexford last Sunday for an IFA protest that called for measures to address concerns over the consolidation in the sector and to tackle the "unacceptable" price gap between Irish and British cattle.

The protest came amid reports that weight and age limits are being imposed by some factories ahead of an expected 50,000 to 80,000 extra supply of cattle for meat processors later this year.

Henry Burns, the IFA livestock chairman, stated there is a "lack of competition" on the island.

Mr Burns raised concerns over changes in the meat sector that would see ABP move from processing 22pc of the beef kill to 28pc.

"We feel there is not enough competition in Ireland and the issue on EU labelling has not been resolved, which impedes live exports to the UK," said Mr Burns.

The Competition and Consumer Protection Commission (CCPC) has yet to be notified of the proposed ABP and Slaney Meats deal. The IFA had called on Mr Coveney to make a submission to the competition watchdog on the merger.

"The minister is aware this issue is causing major concern to farmers and producers of meat.

"He is writing to the Competition and Consumer Protection Commission asking them to examine in full whether there are competition issues of concern," a spokeswoman for the minister said yesterday.

An ABP spokesman said the deal was subject to approval.

"This is about both companies developing the scale to compete on increasingly competitive international markets," he said.

Industry

Meat Industry Ireland (MII) strongly rejected the IFA claims over cattle prices and competition.

"Irish cattle prices remain higher than in most EU countries and in many instances are higher than prices in many of our key Continental export markets," said spokesman Cormac Healy. "Irish prices have been consistently above the EU average and are currently at 104pc of the EU average prevailing price."

MEP Mairead McGuinness said the level of support at the protest demonstrated the "sense among beef farmers that they don't get a fair crack of the whip". She said this matter has been raised with the European Commissioner for Competition, Margrethe Vestager.

The IFA said the average Irish/UKprice gap for 2015 widened to 82c/kg or €293, up from an average of 27c/kg or €97 in the decade to 2013.

Mr Burns said the recent moves on weight limits and age penalties from the quality payment system was a breach of the Beef Forum.

MII said the carcase weight moratorium came to an end in December, with processors now adopting their own approach. It added there were less outlets for heavier carcases.

IFA presidential candidate Joe Healy described the beef grid as "dysfunctional" and called for changes to the pricing mechanism. He said the grid was currently "stacked in the factories' favour" and had lost farmer support.

Presidential candidate Flor McCarthy said the price differential between the Irish and UK market must be challenged.

The proposed ABP and Slaney Meats partnership would see a restructuring of the Slaney business that is currently jointly owned by the Allen family and Linden Foods in Northern Ireland. ABP plan to invest in Slaney to form a joint venture with Linden/Fane Valley.

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