Beef crisis: prices slump as Brexit threat looms

  • 'Make-or-break year' for sector

  • No-deal UK exit to 'wipe out sector'

  • Vets' dispute disrupting trade

Cattle unloaded by farmer. Picture; Gerry Mooney
Cattle unloaded by farmer. Picture; Gerry Mooney

Declan O'Brien and Martin Coughlan

THE beef sector is at crisis point due to the continuing slump in factory prices and the threat of a no-deal Brexit, farm leaders are warning.

Beef farmers will be directly in the firing line of a no-deal Brexit.

The Government will be looking for a "mega-money" aid package from the EU to offset the damage.

The pre-Christmas slump in cattle prices carried over into the new year, with factory quotes unchanged and farmers struggling to get stock killed.

Adding to the existing problems, a 'work-to-rule' protest by temporary veterinary inspectors (TVIs) is seriously disrupting operations at slaughter plants.

ICSA beef chairman Edmund Graham predicted that 2019 will be a make-or-break year for many beef farmers.

"As it stands, many farmers are on the brink of giving up. It simply isn't economic to produce beef at current prices.

"When we factor in Brexit uncertainty and the risk of a no-deal outcome, the potential for things to get worse has many farmers ready to pull the plug on unprofitable systems," he told the Farming Independent.

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Base quotes for steers and heifers remain on €3.75/kg and €3.85/kg respectively, with cows making €2.50-2.80/kg for P and O grades, and up to €3/kg for R grades.

However, meat plants are not anxious for numbers and some farmers are waiting up to a fortnight to get stock slaughtered.

The problem is particularly acute for bulls, with factories showing very little interest in Friesian bulls. While coloured bulls are being quoted at €3.50-3.80/kg for O to U grades, a flat price of €3.50/kg is being paid for Friesians.

IFA livestock chairman Angus Woods said winter finishers were "shipping major losses", with prices 25c/kg or €90/hd below this time last year.

Mr Woods called on Agriculture Minister Michael Creed to target a doubling of live exports in 2019 from last year's level of 190,000hd.

He said such a move would create real competition for cattle on the home market.

IFA president Joe Healy warned if the UK crashes out of the EU "we are facing a far more serious situation and the potential wipeout of beef production in this country".

Mr Healy called on Mr Creed to provide more detail on the aid package he says Ireland will demand from Brussels in the event of a hard Brexit. Mr Creed estimated it will be in the "hundreds of millions" and referred to "mega-money".

Mr Graham said intervention buying of beef will be needed on a major scale if the UK exits the EU with no deal and WTO tariffs apply.

"Minister Creed needs to get firm commitments on this straight away from the EU Commission. The critical issue is that the intervention trigger price has to be adjusted upwards towards €4/kg in order to be any use," he said.

"It is clear that a hard Brexit will cause havoc for Irish beef, and it is not in the interests of any other EU member state to have massive quantities of Irish beef floating around Europe if access to the UK market is uneconomic due to WTO tariffs."

ICMSA president Pat McCormack questioned why the Irish steer price was 40c/kg below British prices and 20c/kg under the EU average.

"A gap of €140/hd between Irish and UK steers is both inexplicable and unacceptable and clearly highlights why the anger amongst beef producers is justified," Mr McCormack said.

"Farmers are absolutely fed up of additional standards being imposed on them in the name of sustainability, while they receive a price for their beef that is in no way sustainable.

"We cannot go on like this, and ICMSA believes that market transparency measures will have to be introduced."

Meanwhile, the farm organisations and meat processors have called for a resumption of talks to end the TVIs protest . Meat factories claim the dispute is continuing to curtail the processing of animals.

Indo Farming

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