IFA President Joe Healy has called for a strong beef increase from the factories, saying there was a full clear out of retail beef sales over the holiday period and factories are very anxious for cattle again in the New Year. He said a significant price increase is well justified based on strong demand and improved market and exchange rate returns.
Joe Healy said paid prices at the factories moved in the right direction over the Christmas/New Year period and €3.80/kg base for steers and €3.90/kg base for heifers was freely available and more being paid in places to secure numbers.
He said prices in our main export market in Britain closed the year in a strong position with R3 steers making €3.62/kg and, at the current exchange rate of 85p/€, this is equivalent to a price return of €4.49/kg including VAT at the new higher rate of 5.4% applicable from January 1st.
Joe Healy said as well as the strong price returns in the UK, the positive change in the Sterling exchange rate from 89p in October/November back to 85p/€ currently is worth an additional 21c/kg in returns and leaves the factories in a strong position to increase prices to farmers.
Joe Healy said the factories have fallen well behind on price with the Irish price now below the EU average and a very wide gap opening up with prices in our main export market in Britain.
The IFA President said winter finishers need a strong price lift as selling cattle out of sheds involves very high costs and at current prices these farmers are encountering serious losses.
On live exports, Joe Healy said IFA has been working hard on calf exports for next spring and has met a number of the exporters and the Department of Agriculture in recent weeks. He said a strong live export trade for calves is essential for competition and to maintain a supply/demand balance in the Irish beef sector capable at delivering viable prices to farmers.
Joe Healy said IFA had met with the Department of Agriculture on calf sales and exports for 2017 and requested that the Department of Agriculture reduce the fees of up to €7.00 per head charged on calf exports. He said the charges made up of Department of Agriculture inspection and disease levies, as well as Bord Bia charges, are way too high relative to the value of the calf. He said it is completely unfair that a calf worth between €80 and €150 per head would have to pay the same level of charge as a finished animal going through a meat plant worth €1,400 per head.
The IFA leader said IFA also met with Cork Marts, and while it was disappointing they were exiting the trade, the group have made some changes which will facilitate the sale and export of calves in 2017.
He said Cork Marts have agreed to provide a rebate of €1.50 per head to purchasers who buy over 100 calves in their group. In addition, they will reduce the costs on sellers by over half from €6.50 to €3.00 per head on up to 50 calves.
Joe Healy said IFA had worked hard in opening up the live export trade to Turkey this year and this had proved critical to the weanling trade throughout last autumn. He said a boat load of weanlings sailed to Turkey at the end of December.
The IFA President said it is vitally important that Agriculture Minister Michael Creed and his Department ensures that a strong live export trade to Turkey and other Middle East and North African destinations continues into 2017.