5 December 1997

Bone marrow fears push beef prices to brink

By Tim Relf

BEEF traders were bracing themselves for another hit on prices, as government information on the possibility of BSE material in bone marrow emerged on Wednesday (Dec 3).

Restaurateurs and butchers were anticipating a further drop in meat sales, which is bound to be passed back down the food chain. And the immediate ban on bone-in beef will lead to extra costs in the abattoir sector, a cost which will again land at the farmers door.

Cattle prices are already at a 16-year low, as import pressure, the absence of intervention-buying and the lack of an export market continue to drive the market down.

Tuesday saw steers and heifers average 89.4p/kg and 88.2p/kg, respectively. The fall of over 10p in the space of a month prompted farmers to take to the streets this week, protesting at cheap imports.

Meat and Livestock Comm-ission figures show imports from other EU states were 52,917t in the first eight months of this year, up 63% on last year. Shipments from the Irish Republic rose 78% to more than 31,000t.

Intervention is doing little to shore up the market. Last Fridays adjudication saw no beef accepted from GB traders and EU officials suspended the whole process for the rest of the year. Community-wide, beef prices had recovered, they argued. The plan now is to sell the 680,000t in store to the processing industry.

Surrey abattoir boss Andrew Chitty says the demise of intervention wont help prices. "But it was only ever a stop-gap. You cant build a future on intervention."

The main problem now, he says, is not with depressed finished cattle values, but with over-priced calves. If the best Continentals were only costing £80 to £120, there would still be a margin.

Final straw

But for many farmers, news of lower prices will be the final straw. As auctioneer Peter Kingwill at Chippenham, Wilts, says: "It is devastating at this time of year, because now is when people rely on the trade to be rising."

Driffield-based farmer Nick Baker has been badly hit: "We shifted more towards autumn-calving because May and June seemed to be the pits as far as selling finished cattle, so we have aimed for the Christmas market. What can we do now? Delaying selling stock is the road to ruin. We have to sell them when they are ready," says Mr Baker.

Mr Chitty agrees: "Cattle and sheep are like strawberries and peaches. They should be picked and sold when they are ripe. Trying to play the market is a dangerous game." &#42

From the left… Raymond Wight of Scotch Premier Meat, Hugh Pennington of Aberdeen University and Brian Pack of ANM inspect the champion at this weeks carcass show in Inverurie. The 368kg Charolais cross steer from Stewart and Douglas Duncan, Gamrie, was sold for £3500 to judge Harry Mills. Prof Pennington criticised the lack of government progress on licensing butchers shops.