9 July 1999

Check on subsidies after CPAS finishes

By Simon Wragg

PRODUCERS looking to rear bull calves after the demise of the calf processing aid scheme must ensure stock is eligible for subsidy payments to avoid big losses.

The Meat & Livestock Commissions Duncan Sinclair warned farmers at the Royal Show that most bull calves will grade as O- and P conformation and few as O+s. That will cut what abattoirs are prepared to pay. "The most crucial thing is the availability to claim beef special premium," he said.

Even with a BSP claim producers would have to sell finished cattle for £1.30-£1.40/kg deadweight to make a margin. "Without the BSP payment that rises dramatically to £2.20-£2.30/kg for an O- carcass and that is totally unrealistic, certainly for the next 18 months to two years," said Mr Sinclair.

Bull beef, which will form a big portion of calves reared after CPAS, currently accounts for 13-14% of the market. Most is destined for manufacturing use. That means securing an outlet is essential before rearing begins, he warned. But with only two processors actively talking about contracting supplies, many producers could find that difficult.

A four-page brief was available at the show outlining the facts, ahead of a more detailed MLC leaflet which will be available later this month. Those deciding not to rear could still sell calves on for rearing or slaughter at 3 months old, said Mr Sinclair.