Business Irish

Thursday 18 January 2018

Real victims of the horsemeat scandal are quality food producers

The horsemeat debacle has fallen off the news pages, but the fall-out in the food sector is only beginning to hit home.

Ironically, the same beef farmers who told us that the sorry saga was threatening their livelihoods have rarely received better prices at the meat factories for their cattle in recent weeks.

Instead of shaking customers' confidence in quality meat supplies, it strengthened the demand for bullet-proof supply chains.

The real losers from the food fraud are those who built up businesses on the back of selling products containing processed meat.

Take Michael and Gabriel Hoey, the brothers who run a farm and food processing company called Country Crest in north County Dublin.

When they left school at 15 to work fulltime on their father's vegetable farm, the notion of working with Michelin star restaurant chefs to develop top of the range ready meals was not on their radar.

Their daily routine consisted of starting work at 5am each morning in the dark cabbage fields of their father's farm.

But the work ethic that was instilled in the young men then has stood them well. The Hoeys now employ 170 at their farm and food processing facility in the hills just west of Skerries. So what happened in the interim that catapulted the two men from snigging veg to hugely successful food entrepreneurs?

Twenty years ago, they set up a company to wash and bag potatoes for the supermarket trade. They called it Country Crest.

It was a brave move for them at a time when interest rates were hitting 27-28pc. No bank would lend them the capital required. "They wanted to know what our qualifications were," recalls Michael.

Instead, a loan from a business acquaintance got them off the ground. But even when they secured big contracts with the likes of Tesco, it wasn't plain sailing.

A quality controller from the British retail giant came down to inspect their packing operation and said the potatoes were not up to their grade. "I went home devastated convinced that we would never be able to work with these guys who seemed to be looking for the earth, moon and stars," he recalls.

"But I realised that this was actually what we had to do to keep a niche for ourselves in the business."

That belief in always seeking out a niche has paid off. They now farm 2,500 acres of potatoes, onions and cereals, pack out over 11,000 tonnes of potatoes a year and, more recently, established a ready meals business that now claims to be the largest of its kind in Ireland.

Again, they've targeted the niche, and in doing so avoided going head to head with the multinational giants, such as Greencore and Kerry.

Instead they focused on fresh ready meals – the ones that make up the 'Dine In For 2' offers that every supermarket uses to lure in tired customers at the end of a long week.

Then the horsemeat scandal broke. "We've seen our sales tumble by 35pc on average. Some lines, like the cottage pies and lasagne have been really hammered. They're down by up to 60pc," admits Michael.

"We've undergone a whole series of audits, DNA tested everything, and now spend about €3,000 a month on DNA testing to prove that we've never bought anything but Irish meat here. The credibility of the whole food business has been tarnished by this skulduggery."

Hoey doesn't believe the line that has been repeated by all of the large processors involved in the crisis so far. "I don't buy this notion that people didn't know what was going into the machines.

"You know exactly what goes into every product. Eighty people down there (on the factory floor) would know if I switched an ingredient. It doesn't just happen. If a product is 10-15pc cheaper, you know there is something dodgy about it. You get what you pay for."

Michael is also scathing of those who blamed the supermarkets for the fiasco. "It's nonsense to blame the supermarket. If a supplier can't do it for the price that the buyer wants it at, there's one word, 'No'."

Irish Independent

Promoted Links

Business Newsletter

Read the leading stories from the world of Business.

Promoted Links

Also in Business