Northern Irish beef producers have warned that a special €100m (£89m) aid package to their competitors in the Republic of Ireland (ROI) could distort the market and hit already depleted margins.
The comments, expressed in a letter from the Ulster Farmers Union (UFU) to Defra, follow agreement in Brussels of “exceptional adjustment aid”, which will see €50m (£44.5m) of EU money paid to the Irish beef sector, match funded by the Dublin government.
In the letter, UFU beef chairman Sam Chesney explained that farmgate prices for beef in Northern Ireland have dropped almost 10% over the past 12 months, from 377p/kg to 342p/kg for a U3 steer.
“This continuous fall in price has been happening at a time when input costs have risen significantly and has put pressure on profit margins,” he said.
“Beef imports into Northern Ireland have also risen, while there continues to be an abundance of local, high-quality, farm quality assured red meat available.”
Handing out an extra £89m to beef producers in the Republic, to help them cope with Brexit uncertainty, would have further negative repercussions.
“Without a similar package here, the ROI intervention could potentially distort the UK and EU markets, putting even more pressure on already squeezed farmgate prices,” said Mr Chesney.
“Something needs to be done. The UK government has a role to play in ensuring the future of family-run farms is viable.”
The Irish aid package was given the green light by EU member states on Thursday 2 June “in recognition of the particular difficulties experienced by Irish beef farmers arising from significant price falls and market uncertainty”.
The Dublin government has to present a framework on how the money will actually be allocated to Brussels by the end of July, though the EU Commission says it should avoid distorting the market and should include measures to boost demand and raise standards.
But the Irish Farmers Association (IFA) is adamant the money should go entirely to farmers – namely those who have sold prime, finished cattle since last autumn and suckler producers.
IFA livestock chairman Angus Woods has written to Irish farm minister Michael Creed insisting that any measures to reduce production or attach other conditions should be dismissed.
The IFA estimates beef producers have lost more than €100m (£89m) in earnings since last autumn.