Livestock Event 2014: Beef producer confidence at all-time low, says FFA

Turmoil over beef prices has left producer confidence at an all-time low, prompting many farmers to reconsider their future in the industry, Farmers For Action (FFA) warned at the Livestock Event.

FFA chairman David Handley said beef producer confidence was lower than during the toughest period of the dairy crisis, and without an increase in profits, farmers could be forced to sell their cattle in the autumn.

Speaking at the Livestock Event on Wednesday (2 July), Mr Handley said that the agreement this week between processors and farming unions to draw up a voluntary code of practice to increase transparency in the supply chain needed to make swift changes to beef farmers’ fortunes.

See also Beef summit: Farmers and processors to work on industry code

“We have to see things starting to change over the next three to four weeks if we are to see a change in their fortunes,” he said.

“The backlog of animals we are seeing of up to eight weeks can’t go on. If I was a beef producer looking at my numbers I would be wondering what I was doing it for.”

While the reduction in feed costs was helping, Mr Handley said there still were too many anomalies on labelling of British beef and retailer margins, which the voluntary code needed to rectify urgently.

“Unless the retailers look at their margin and get the stock-pile moved, things won’t improve,” he said.

“We want to know why ministers aren’t pressing the retailers more. If the retailers are taking a 30% margin in red meat, why aren’t they passing more down the chain?”

Farm minister George Eustice said while the government was willing to help address issues in the supply chain, it was unable to intervene over prices.

“When you have a crisis like this it does sometimes show weaknesses in the supply chain, which is why we established the dairy code of practice” he said.

“We hope that a similar code [for the beef sector] will ensure transparency and address those weaknesses. But we have to be honest about what we can and can’t do, and we can’t intervene on margins.”

While labelling rules had helped improve consumers’ ability to identify British beef, Mr Eustice said there were issues over some retailers mixing British and Irish beef on supermarket shelves.

“I understand why that’s frustrating for producers,” he said “It was something that was raised strongly at the meeting and it’s something the retailers will reflect on.

“It was suggested at the meeting that prices are cyclical, and although the past six months have been pretty dire, we might see a bounce-back,” he added. “I hope that’s right and this is just a short-term blip.”

See also All the news and photos from the Livestock Event 2014