IFA – beef industry must insist on price increases!

IFA President Joe Healy has called on factories to put pressure on UK retailers, insist on higher prices for Irish beef, and pass increases back to farmers.

  Mr. Healy said: “It is very clear that Irish cattle prices are far below where they should be, based on British prices and the substantial devaluation of Sterling since the June referendum. Farmers are extremely frustrated that they are producing at a loss while price increases from the UK market are both justified and achievable.

  “Factories need to recognise that the Irish beef sector is being undermined and put at risk by this market dysfunction. Factories, and all sections of the industry, know there is no future for the Irish beef industry at these prices.”

  The farmers’ president continued by calling for beef factories to insist on higher returns.

  “In a properly functioning market, a retail price increase, passed back down the chain to primary producers, would be the normal economic response to the devaluation of Sterling that has occurred since the Brexit vote. This is exactly what is happening in the case of suppliers such as Unilever and Nestle.”

  According to statistics from IFA, the current British retail price of beef is £6.85/kg. If the 14% Sterling devaluation applied, the average retail price would be about £7.80/kg. British cattle prices have risen by 41p/kg or 13% since May, while Irish cattle prices have fallen from a base of €4.10/kg in June (pre-Brexit) to €3.60/kg, a reduction of 12%.

  Mr. Healy called on Minister Creed to make it clear to all players that Irish beef farmers cannot be expected to carry the can for Brexit and the Sterling devaluation.

  “Factories, Bord Bia and Minister Creed must recognise that Irish farmers cannot take loss-making prices for their beef to suit UK retailers. That situation is completely unsustainable, unfair and doing serious damage to our €2.5bn beef sector.

  “As we face into the uncertainty of Brexit, it was never more important for our Government and the EU Commission to tackle the excessive power of the retailers. Politicians talk and promise a lot on retail regulation but have delivered nothing to curb abuses by retailers,” he concluded.