TEAGASC FINDINGS ON LACK OF PROFITABILITY MUST BE CENTRE STAGE IN BEEF CRISIS TALKS

5 SEPTEMBER 2019

ICSA beef chairman Edmund Graham said that figures from Teagasc showing complete lack of profitability underline the need for reality from beef processors and retailers in dealing with the factory protests. “Lack of profitability due to an unsustainably low price must be centre stage in beef crisis talks.”

“It is now crystal clear that the ruthless exploitation of farmers for many years by processors and retailers has blown up in their face and that solutions to the beef factory protests must involve recognition that current beef prices are utterly unsustainable.” Mr Graham was responding to comments made by Teagasc head of drystock, Pearse Kelly, at a beef meeting in Kilkenny on Tuesday night (3 Sep).

Teagasc has now admitted that at current prices, a suckler to beef enterprise will lose €150 per cow, and that assumes that the finished animal gets the 12c QPS bonus. The analysis suggests that rearing a dairy calf to beef will lead to a loss of at least €150/head and over €200/head where there is Jersey cross breeding involved.

“Unfortunately, all of this demonstrates that ICSA has been correct all along to suggest that farmers have no business rearing dairy calves, even if they get them for free. It also suggests that giving farmers a coupled payment for suckler cows is futile and that farmers would be better off with payments over five years to voluntarily reduce suckler numbers.”

Mr Graham added that advice from Teagasc on increasing efficiency, and advice from ICBF on producing better stock, means nothing when prices are at current levels. “No amount of efficiencies could ever make up the gap. Mr Kelly’s presentation last night clearly indicated that no beef production system is profitable at current prices. These findings must also serve as a wake-up call for retailers and processors. Business as usual is not working; the model is broken, and we can’t go back to the way things were.”

“ICSA is calling on all retailers to clarify if they are happy to continue exploiting farmers. It’s all very well saying markets are sluggish but the reality is that big supermarkets control almost 90% of beef retail sales in Ireland and the UK and therefore set the market.

They use cheap beef so that consumers are then conned into paying up to €12 for 4 replacement shaving blades which can be manufactured in a few seconds for a few cents in a low wage country. Meanwhile, farmers in Ireland are expected to spend three years producing grass fed beef, complying with the highest animal welfare, quality and traceability standards in the world. After all that effort, supermarkets repay them with a price that was actually available to farmers in 1988.”

ICSA is now insisting that talks to resolve the beef protest must include retailers and meat factory bosses. “There is no point wasting time talking about peripheral issues if we do not address the need for a sustainable beef price,” concluded Mr Graham.

ENDS