Food chain to meet over beef business problems

DEFRA is to host an industry-wide beef summit next Friday (14 October) to thrash out some of the problems confronting the sector, including the lack of profit to farmers and the risk this poses to future production.

Invitations were sent out by junior DEFRA minister Lord Bach this week to all key players, including the farm unions, processor groups, retailers and the levy boards.

The idea of a special summit was first floated by NFU president Tim Bennett last week. But subsequent discussions led to the conclusion that DEFRA would be better-placed to host it in the interests of neutrality.

Mr Bennett said he was delighted things had moved on so quickly. “I wanted to get the whole beef chain together to make sure they really understand the ramifications of where the sector is going.

“We have been through 10 years of turmoil in which millions of pounds have been spent by government supporting the beef industry.

Just at the time when we are about to get back to normality, the [price] signals that are coming from the rest of the chain could be potentially disastrous.”

These problems were thrown into sharp focus this week by new data from the Livestock and Meat Commission for Northern Ireland.

“Farmgate prices have fallen since June as the retail price has gradually increased,” said LMC economist Jelmer Hania.

“This has resulted in the lowest ratio of farm to retail price in years.

In GB producers receive 42% of the retail price, but in Northern Ireland they receive 39%.”

The development prompted an angry response from the Ulster Farmers’ Union.

“The beef industry at producer level is in crisis, and now we see evidence that, despite this, retail prices are actually increasing,” said deputy president Kenneth Sharkey.

“We can only draw one conclusion – that the revenue in the beef industry is being carved up greedily between retailers and processors.

This is extremely short-sighted and urgent action must be taken to ensure farmers also receive a fair price.”

The National Beef Association has warned that, with beef finishers now receiving 25% less income than last year, and with in-calf heifer numbers back by 22% in some areas, large parts of the production sector were in danger of being dismantled.

“Our view is that, if processors and retailers cannot support home-produced beef, then farmers are mugs to stick with it,” said NBA chairman Duff Burrell.

Peredur Hughes, NFU Cymru president, agreed that low prime beef prices could have a catastrophic impact on Welsh suckler herd operators.

“We depend on finishers coming across the border to our autumn sales.

If store cattle prices plummet we will see the wholesale slaughter of suckler cows.

The Welsh industry will lose critical mass that will be very difficult to recover.”

Meanwhile, the English Beef and Lamb Executive has said it is pulling forward some of its 14m marketing campaign, to try to encourage shoppers to select Quality Standard beef over commodity imports (see Talking Point, p43).