Retail giant gives boost to bull calf potential

Dairy bull calf prices could receive a much-needed boost after another leading superstore announced plans for a scheme that guarantees a market for young black-and-white bulls.

The agreement between Sainsbury’s Dairy Development Group members and Anglo Beef Processors will see the calves being used in the red meat supply chain, rather than being disposed of, and offer Sainsbury’s dairy farmers a guaranteed calf price.

Sainsbury’s has 335 SDDG farms, accounting for about 50,000-head of cattle. Farmers will be given the option to sell calves at 14 days, post-weaning (12 weeks) or finish them on their own farm. Arrangements will be included for TB-restricted herds.

The scheme will be launched formally in the New Year, when contract details will be available. But Sainsbury’s agricultural manager Annie Graham said terms would be “as attractive as possible”.

SDDG chairman William Goodwin welcomed the plans and that farmers had been involved throughout the calf scheme’s development.

“Farmers will be delighted there’s an option to deal with black-and-white bull calves, so I think uptake will be high.”

On his farm at Ardingly in West Sussex, the 700-cow herd typically produced 250-300 bull calves a year, which were given to a neighbour for nothing, he said. “We will be joining the scheme once it’s up and running.”

The scheme will complement another, smaller-scale, initiative to use bull calves from SDDG farms in the production of veal for sale in Sainsbury’s stores from 21 January 2009, Ms Graham added.

“The veal market is very small, so it isn’t a solution for all calves coming out of SDDG farms, but will be for some. It’s still at an early stage, but welfare is key.”

Rearing units are Freedom Foods accredited and all within 30 minutes of the farm of birth to minimise transport times, she said. Journey times to processing facilities will also be kept to 30 minutes.

Other retailers’ stance

Several other retailers have arrangements to deal with black-and-white bull calves coming from their dairy farmer suppliers. For example, Tesco‘s “Calf-link” scheme gives farmers the option of sending dairy bull calves to the supermarket’s beef suppliers for rearing and finishing instead of exporting them. Prices are benchmarked against market prices.

Asda has a two-pronged approach under its “360-degree Sustainable Dairy Calf Scheme”. The first provides a 20% discount on single-sexed semen to reduce the number of bull calves born. The second stage encourages dairy farmers to rear bull calves themselves, or send them to Asda BeefLink members for rearing to 180-260kg for the Asda beef range.

Asda to pass on profits

  • In conjunction with specialist calf rearer The Calf Company, Asda has launched a new scheme designed to pass more profit back to its farmers.
  • Through CalfLink, farmers are eligible for a 10% discount on all milk powder and supplements, a free production review and management plan by The Calf Company, and bespoke training courses at Asda’s new CalfLink rearing centre of excellence.
  • Sainsbury’s has also announced that from January 2009, it will be the first supermarket to use only British meat in all of its hot and cold pies, soups, party food and ready meals. Currently, about 85% of meat in such ready meals is British, with the rest made up from regions such as the Far East. The move to 100% British meat will see about 3100t of beef and 6200t of chicken used each year from British farms.

Futures markets and commodity risk management online course:

  • Risk management strategies for a more predictable financial performance
  • Educated conversations when collaborating with your advisors
  • Negotiate better prices with your grain merchants

View course