14 Sep 2016
RETAILERS AND PROCESSORS ACCUSED OF SHORT-CHANGING FARMERS AND MISLEADING CONSUMERS OVER LOSS-MAKING BEEF PRICES – IFACattle
Livestock farmers, angry at excessive and unjustified beef price cuts, staged a protest at the Aldi supermarket in Tullamore today (Wed), accusing retailers and processors of short-changing farmers and misleading consumers over the unfair share out of the price in the supply chain.
IFA President Joe Healy accused retailers and processors of failing to honour their responsibilities to farmers and consumers. He said, “Retailers are guilty of using farmer profiles to market our top quality beef to consumers pretending they are returning a fair price to the farmer. However, the reality is retailers are turning their backs on farmers by allowing processors to drive down prices to unsustainable loss-making levels.” Joe Healy said what is happening to beef prices is anything but fair trade.
Joe Healy said, “Since May 1st, factories have cut prices to Irish farmers by 35c/kg, from €4.10 back to their current quoted base price of €3.75/kg, forcing farmers into a loss-making situation. Over the same period, prices in our main export market in the UK have risen by the equivalent of 50c/kg. UK beef prices are currently £3.60/kg and at the current exchange rate of stg 85p/€, this is equivalent to €4.48/kg including Vat”. Joe Healy said these price cuts are totally unjustified and not based on market returns.
The IFA President pointed out that with average Irish retail price for beef at €8.92/kg, retailers and processors have plenty of margin to pay producers a sustainable beef price in the range of €4.00/kg to €4.50/kg, which Teagasc has stated is necessary for cattle produced off grass and for winter finishers.
Joe Healy said the beef price paid to the farmer is totally transparent and the lack of margin at farm level is there for everybody to see. However, he said there is no transparency on the profits of the major players in the industry or the money taken out of the price chain at each stage. “The failure to regulate the retailers and processors in the food chain is allowing them to drive prices to unsustainable levels. Retailers’ claims about sustainability are meaningless without a sustainable price back to farmers.”
IFA Livestock Chairman Angus Woods accused the processors of exploiting difficult weather conditions, particularly in the west of Ireland. “We had the same tactics after Brexit, when the processors jumped the gun to turn the screw on prices. The market returns simply do not justify the cuts imposed on producers. Without a decent margin, farmers cannot survive”.
Today’s protest also heard strong criticism of the Competition and Consumer Protection Commission (CCPC), which has refused to investigate the competition issues raised by the independent report submitted by IFA to DG Competition in Brussels and the CCPC.
Joe Healy said farmers would be flabbergasted to discover that the CCPC has effectively washed its hands of their responsibility to investigate serious competition issues in the Irish beef sector which are highlighted in the report. “For the CCPC to conclude that the proposed Slaney/ABP deal does not ‘threaten to affect significantly competition in a market’ beggars belief”.