Minister Creed Must Take Urgent Action on the Income Crisis in the Livestock Sector – IFA
IFA National Livestock Chairman Angus Woods said livestock farmers are under immense income pressure from falling cattle prices, increased costs, severe weather conditions all year and the erosion of direct payments.
He said the income crisis in the livestock sector must be urgently addressed by Agriculture Minister Michael Creed and he cannot allow Budget 2019 pass without delivering on the IFA proposal for the introduction of a €200 targeted payment for suckler cows.
Angus Woods said the October Budget is Minister Creed’s last chance to deliver on the €200 for suckler farmers, who are on their knees in terms of low incomes and rising costs. He said confidence is at a very low ebb in the suckler sector after the horrendous year they have been through and are now facing a very difficult market situation for the sale of weanlings and stores.
In addition to the €200 suckler cow payment, the IFA National Livestock Chairman called on Minister Creed to show much more support for the low income livestock sector. He said the Minister needs to support the live export trade with export credit insurance, mechanisms to deal with currency fluctuations and increased promotions. He said the live trade is critical for competition and additional market outlets.
Angus Woods said there are live export opportunities, which if fully pursued, would significantly boost the mart trade for store cattle and weanlings. “Minister Creed has to show that the Government is concerned about the income crisis in the livestock sector and take immediate action on sucklers and live exports.” He said the live trade to Spain has major potential if fully developed and supported.
On the finished cattle side, Angus Woods said the factories needed to stabilise and increase prices. He said this is possible in view of the strong turnaround in cattle prices in our main export market in the UK, where prices have increased by over 8p/kg in the last three weeks.
The National Livestock Chairman said factories needed to seriously commit to winter finishers and provide contract arrangements which will reduce the risk and ensure that there is a reasonable margin for the finisher. He said there are some talks of contracts with individual factories and feeders. He said farmers looking at buying cattle this autumn to feed over the winter months are not prepared to take on the risk involved on their own.
The IFA Livestock Leader said price arrangements and contracts which reduce or eliminate the risk are now typical across several farming systems, including between dairy farmers and their co-ops, and it should be no different with meat factories and their suppliers. He said factories are dealing with the same retailers and financial sustainability was essential to ensure continued supply.
Angus Woods said the cattle trade is at a critical juncture and it is essential that factories respond positively on prices and do not undermine confidence further at this time.
Angus Woods said following a number of weeks of falling prices in the UK, prices have turned and increased strongly for the last two weeks. UK cattle prices rose by 4p/kg in the week ending Aug 18th. And another 4.3p/kg in week ending August 25th. He said against this background in our major export market, Irish factories were in a position to stabilise and increase prices and he called on the factories to show some commitment to their suppliers. He said UK steers were making £3.73/kg, which is the equivalent of €4.37/kg incl. vat at an exchange rate of 90p/€.