Wednesday 13 December 2017

Furious farmers’ and their beef with the supermarkets

Kim Bielenberg finds out why our agricultural community is boiling with rage

IFA President Eddie Downey and IFA National Livestock chairman Henry Burns lead the march, as over 500 IFA members protested at Tesco in Naas Co Kildare
IFA President Eddie Downey and IFA National Livestock chairman Henry Burns lead the march, as over 500 IFA members protested at Tesco in Naas Co Kildare
IFA National Livestock Chairman, Henry Burns pictured with his wife Claire on their farm in Mountmellick, Co. Laois

Supermarkets like to peddle a homespun image of how their food is brought from farm to plate. Whether it is meat or vegetables, the aisles are full of pictures of satisfied farmers producing food for the multiples in a rural idyll.

But beneath this comforting, pastoral image, many farmers are boiling with rage, and nowhere is this more evident than among those who produce beef.

They argue that the prices paid by consumers for their prime cut or their half kilo of mince remains high, and has not changed significantly in the past year.

At the same time the amount paid to farmers for their cattle has dropped by up to 20pc.

When you walk into your local supermarket you can expect to pay over €9 a kilo for beef.

The farmers' cut is as low as €3.60 per kilo, and they warn that it is dropping all the time.

The farmers see this as part of a trend where they are squeezed with diminishing margins -and they are not taking this lying down.

In recent days, the farmers brought their battle right to the front of a Tesco supermarket in Naas, Co Kildare in a scene that must have been a PR nightmare for the giant British chain.

Hundreds of farmers from all over the country commandeered up to 800 shopping trolleys at the Naas store and two tractors were parked there.

Irish farmers still have a long way to go before they match the militancy of their French counterparts. In France, disgruntled agriculturalists have been known to burn lorries, ransack fast-food restaurants and even blockaded Disneyland.

The Irish approach to protest may be more genteel, but the Tesco demo is seen as a sign of things to come.

So why are Irish farmers picking on Tesco? Henry Burns, a beef farmer from Co Laois, was one of the leaders of the recent protest.

He said: "We are not singling out Tesco among the supermarket chains. We plan to hold protests against the others as well in the near future."

The problem for the farmers, as they see it, is that their beef is being sold to processors at a price where they simply cannot make a profit.

They claim they are being "pauperised" while supermarkets and meat plants continue to make healthy income from their beef.

Figures from the Central Statistics Office show how farmers and consumers are both losing out when it comes to red meat.

The CSO figures show that prices paid to farmers for beef have dropped by 16.6pc in the past year. During the same period the price of beef in the shops has remained static, dropping by just 0.6pc. Separate figures show that the price of certain cuts of beef in Britain has increased substantially.

Dermott Jewell, chief executive of the Consumers Association of Ireland, said: "Those kind of figures are ridiculous and unacceptable."

He called for greater transparency about how prices are broken down and who gets what between the farm and the plate.

The farmers may be sizzling with fury at their plummeting incomes, but it is simplistic to suggest that the blame for the decline just lie at the door of the supermarkets, and Tesco in particular.

About half of all beef produced in Ireland goes to Britain, and 14pc of our meat is sold by Tesco.

Ray Doyle of the Irish Co-op Society says Irish beef farmers have faced a perfect storm in recent months.

"Demand for beef in Britain has fallen by 6pc or 7pc," says Doyle. "At the same time supply of Irish beef has increased. Two years ago when the price of beef was high, more cattle were born here.

"When the supply increases and demand drops in one of our biggest markets, the price to the farmer inevitably drops, but there seems to be more to it than that.

"The fact that there are just three large meat processors and three or four big supermarket chains that farmers are selling into accentuates the trough."

In a healthy marketplace, consumers would see a drop in prices if prices dropped at the farm gate, but this is not happening.

Henry Burns, a third generation farmer in Laois, says he does not want prices in the shops to drop.

However, he believes that beef farmers have to get their fair share if they are to survive.

Three years ago, with Ireland in the depths of recession, agriculture was seen as our guiding light.

Prices for beef, grain and other farm commodities were soaring, and there was a certain optimism that the country's rich pasture would offer a way out of the darkness.

Burns says: "There were signs that young people wanted to go back to the land.

"Farmers bought into the marketing idea that there was a great future for Irish beef with quality assurance and grass-based production on family farms.

"Now a lot of that of optimism has disappeared. As soon as there is a surplus of cattle, the prices are back in the bargain basement, and our way of life becomes unsustainable."

It is not simply a matter of price. Irish farmers believe their livelihoods are under threat from changes to labelling and the ages when cattle must be slaughtered to achieve a certain price.

The meat processors want young cattle and farmers argue that this does always not suit Ireland's grass-based production.

A spokesman for Tesco said: "Tesco is committed to working with farmers to create a sustainable farming sector.

"We work with 11,000 farming families and we buy €177m worth of beef annually."

The spokesman said there were a number of complex market forces on a European scale that have an impact on the price farmers receive for beef.

Burns, who is chairman of the IFA's Livestock Committee, says the average income of a beef farmer has dropped to between €9,500 and €16,000, depending on which type of beef they produce.

He says: "On that kind of income, you are really re-arranging the deckchairs on the Titanic."

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