Farm Ireland

Wednesday 21 February 2018

Beef: Beef producers need to focus on correct market specs

Beef prices have seen an immediate negative impact from Brexit.
Beef prices have seen an immediate negative impact from Brexit.

Gerry Giggins

The Brexit vote has had an immediate negative impact on the beef trade. Living close to the border and working on both sides, there is an air of uncertainty among beef producers as the final outcome is still very hard to predict.

A hard border between north and south would have huge implications on the livestock trade. I clearly remember the 1970s and 80s and the difficulties moving animals from one jurisdiction to another.

Northern Ireland remains a crucial market for both live exports, animals for slaughter and carcase beef. Impeding any of this trade will have obvious negative effects.

I shared a platform with Joe Burke of Bord Bia last week. The Bord Bia view is that the immediate beef market turbulence has been caused by uncertainty more than anything else.

The exchange rate changes caused by the weakening of the British pound has also contributed to the recent slide in beef price.

The UK beef price had been tracking upwards in recent weeks which resulted in a relatively stable beef price here in Ireland also.

Joe Burke indicated that the number of animals available for slaughter in the coming weeks would be tight which may feedback into a price stabilisation.

The fear among beef producers here is that Irish beef will be displaced in the vital UK market, if trade deals are negotiated between the British government and South American beef producers.

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However, the majority of the major supermarkets were very committed to continuing sourcing Irish, quality assured beef along with supporting the UK beef farmers. Joe Burke maintained that these supermarkets place a huge value on the quality, consistency and traceability of Irish beef and this far outweighed the option of importing cheap beef from non-quality assured sources.

Other major beef purchasers such as McDonalds and Burger King see our quality assured beef as being a vital part of their supply chain.

A major concern, though, would be that if the Eurozone member countries, with whom Ireland has a significant beef trade, were also to fall into recession, it would possibly have a greater effect on our beef industry.

The importance of meeting market specification was also covered in Joe's presentation.

The difference between a steak cut from a 380kg carcase (young, U grade bull) and that of a 490kg carcase (U grade bull) was stark.

A two steak tray in a supermarket from both carcasses would show a €10 price difference, with the heavy carcase steak retailing at approximately €21-€22.

Consumers are not prepared to pay that level of money when other meat protein sources, such as chicken and pork, are so much cheaper. Some excellent Bord Bia slides detailed both over-fat and under- finished carcasses and their resulting financial impact on the beef farmer.

My take home messages were that there should be no immediate panic in the beef trade and that beef finishers must focus on producing correct market spec animals.

Winter barley crops are fast approaching ripening date as is very evident by the changing field colours throughout the country.

Farmers that are growing their own or purchasing grain at harvest time should now be following a few simple management routines in their grain stores.

Over the past winter, which was relatively mild, I witnessed numerous cases of grain mite infestation in stores. Grain mites can have a devastating effect on grain quality. Their presence generally results in significant spoilage and losses.

Simple routines of removing old material from walls, floors and ducting along with washing and disinfecting the same will eliminate the risk of infestation occurring.

Gerry Giggins is an animal nutritionist based in Co Louth

Indo Farming