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Sunday 17 February 2019

Eddie Punch: We need to go back to basics and develop grass-fed beef as a premium niche product

Expanding live export markets rather than expanding the size of the national herd is the key to a profitable suckler sector

ICSA believes that the obsession with how many suckler cows 'Ireland Inc' has, is the wrong starting point
ICSA believes that the obsession with how many suckler cows 'Ireland Inc' has, is the wrong starting point

Eddie Punch

The suckler sector faces many challenges. The central issue has always been price and profitability.

In recent years, the focus on climate change and the expansion of the dairy herd have combined to accentuate the sense of a sector under siege.

Meanwhile, the ongoing structural realities of an ageing farmer base and the fact that many suckler farms are small scale, often part-time and typically are located on poorer land with high rainfall means that solutions are hard to find.

ICSA believes that the obsession with how many suckler cows 'Ireland Inc' has, is the wrong starting point. It might matter to Government ministers or meat factory bosses to measure success by the total tonnage of suckler beef available for export.

However, it doesn't matter to the individual suckler farmer how many cows there are in Ireland; what matters is how much profit that farmer can make from suckling. And, as is painfully obvious this year, scarcity is better than over supply for the individual farmer.

For that reason, trying to maximise the amount of suckler cows in Ireland by means of a coupled payment is not a smart policy for farmers.

We should be wary of policies to encourage farmers to keep much more suckler cows than they otherwise would.

The only hope for the suckler herd is to focus on viable markets. In turn, the amount of suckler cows should adjust to producing the amount of animals that can make profit for the farmers in the business for the long term.

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Is it a bad thing if we have 750,000 sucklers instead of 1,000,000 suckler cows? Back in the early 1980s we had just 400,000 suckler cows, mainly in the west and most would agree that beef was a far more profitable business back then. The idea that having 1,000,000 suckler cows is a long standing tradition in Ireland is a rural myth.

The first critical measure of success will be the extent to which we expand live export markets.

If Turkey doesn't recover, we need to get more weanlings to Italy and also to tap into the potential for markets such as Greece. But there is no point in pretending that this is easy.

The second issue is that suckler beef cannot survive if all we can do is flog it off as a generic product lumped in with a by-product of the dairy industry.

There is absolutely no point in cutting the Basic Payment and then giving the money back to suckler farmers as a coupled payment if we don't find ways of differentiating suckler beef and getting premium prices for it.

The grid was supposed to deliver decent margins for suckler beef but it isn't achieving profitability for suckler farmers. We need to go much further and develop suckler, grass fed beef as a premium product targeting niche markets.

Part of this will involve ensuring that the carbon footprint of suckler beef is shrinking, but we must also ensure that the images of content calves lying beside their dams in fields is patented as an image of premium suckler farming, not a representation of dairy beef.

The animal welfare and biodiversity benefits of sucklers must be underlined. Consumers need to understand that eating Irish suckler beef is enhancing the landscape and is a positive for the environment. We need to get our act together to get either PGI or PDO status for Irish grass fed suckle beef as a way of gaining and then protecting a premium price from the marketplace.

In terms of schemes, ICSA has welcomed the €40 for weighing suckler stock. Accurate weights can help improve indexes. We are now proposing that an additional measure should be included in the BDGP to deliver €80 for first calved heifers who calve down before 30 months of age.

This is a climate change measure which also benefits farmers on efficiency grounds. Too many dry heifers walking around is doing nothing for profitability and is killing us on carbon footprint.

This can readily be sold to the EU as a climate change measure. There is potential to add on further climate change actions such as reducing the calving interval which also benefits profits on farm. This should be the focus for the remainder of the current rural development programme and must be a part of the next CAP.

BDGP reform

ICSA also believes that the BDGP is in need of reform. There is too much emphasis on maternal indexes which are still only a work in progress.

It needs to be more responsive to the breeding strategies of individual farmers, so that the farmer who is focused on breeding live exports for Italy does not feel excluded.

We need the Department and ICBF to be less defensive about star ratings. While acknowledging that indexes have a role, we also have to accept that they are not yet bullet proof and experienced cattle farmers know what they are doing when they select bulls.

However, all of the above will not work unless beef processors wake up to the reality that there is zero future for sucklers if beef price is stuck at €3.75/kg. We have seen that experimental suckler farms with all their advantages cannot make a profit even at €4/kg.

A key problem is that Teagasc has got to change profit monitor and national farm survey parameters to incorporate the cost of own labour and owned land.

The supposed technical barriers to this can be overcome but it is unacceptable to pretend that any farmer, dairy or beef, is profitable if we assume that farmers and their families should work for nothing and that their land is worth nothing.

If this is done, we will quickly learn that most dairy cross calves where there is significant Jersey/ Kiwi cross genetics are worth nothing and the consequences of that must be addressed.

The current high kill levels in Irish factories reflect too many farmers making nothing out of dairy cross stock, while undermining the demand for quality sucklers.

We cannot build on our position as the principle beef exporting country in Europe with a reputation on quality second to none while trying to mimic New Zealand dairying models, a country that cares little for beef.

Eddie Punch is the general secretary of the Irish Cattle and Sheep Farmers Association

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