- Location
- Bury St Edmunds, Suffolk
Low prime cattle prices in Ireland best tackled by raising retail value – not curbing volume on market.
The Irish Farmers Association (IFA) has attacked processors for paying 73 cents (64p) a carcase kilo less than those buying similar cattle in Great Britain – arguing that only an urgent price lift can restore badly bruised confidence at farm level.
The implication is that Irish processors can put more money into Irish cattle at a flick of the switch but the IFA has failed to acknowledge the width, and depth, of premium differentiation on the British market where most certified Angus cattle are currently selling against an R4L base range of 400p-410p (456-468 cents), in-specification, beef cross, commercial steers and heifers offered this week in England and Wales were traded against a base range of 340p-368p (387-420 cents) while certified stock providing beef that can be sold under the premium winning “Scotch Beef” label are being purchased off a base range of 373p-382p or 425-436 cents. (sterling- euro = 1.14 cents)
(It should be noted that GB’s most recent all-prime average was a much lower 354p (403 cents). This calculation includes all cattle whether qualified for retail schemes or not.)
These differentials, or premia, which are universally reinforced by Red Tractor certification, were not achieved overnight. Scotch Beef is a PGI registered retail label for which only beef taken off cattle born, reared and processed in Scotland can qualify. Most “Scotch Beef” is sold in London
Similarly cattle whose beef is sold under a Certified Angus label must have been sired by registered bulls. A less well known Hereford retail scheme in the UK currently buys qualified cattle off a base of 360p-395p (410-453 cents)
And the value of commercial (not breed specific) cattle sold on the British market is further fueled by the delivery of increased numbers of supermarket specification stock. Their principal qualifications are UK-born, farm assured, UTM, maximum carcase weight 380-400kg and a McDonalds’ led insistence on less than four farm movements.
These cattle include Scottish PGIs and they always top the price range for commercial (non-breed specific) stock because fewer cattle are purchased flat rate and those not meeting spec are discounted.
The rewards for these efforts are beginning to be reaped at a cross-industry level because single steaks retailed in skin packs at exactly the same weight and price as others on the shelf are encouraging repeat purchasing and helping to counter the drag on overall carcase value created by so much beef being sold as mince.
Current estimates are that 54 per cent of beef offered through UK supermarkets is sold as mince. It may be that at 60 per cent of beef moving through the UK, including imports, exports, and cow beef is minced too.
These steaks can only be offered at the right thickness, an attractively modest price, and at a modest weight if they are taken off carcases weighing less than 380kg. Resistance to this development is still strong in Ireland and so the bulk of Irish beef offered in British supermarkets is currently sold as mince.
It also helps if the beef is matured, in most instances this is done over a 21-30 day period, so as much toughness/tenderness inconsistency as possible is eliminated – and both processors and retailers are only prepared to meet the cost of this if they feel confident about the size, weight, age, breed and overall provenance of the cattle they buy in the first instance.
If IFA calls for factories to reverse some of the price cuts of recent weeks are to be successful more of the cattle bred, finished and processed in Ireland are going to have to be targeted at specific retail export markets too.
Current Association hopes rest on shortening processor’s supplies by diverting more cattle through live export outlets.
But it is not the volume of cattle on the Irish market that is the problem. Breeders and feeders are not earning as much as they need to because too much Irish beef is offered as a second choice commodity on its most important retail markets – a situation not helped by many of its cattle coming to the market too old and too heavy as well.
Robert Forster is the editor and publisher Beef Industry News. www.rforster.com
The Irish Farmers Association (IFA) has attacked processors for paying 73 cents (64p) a carcase kilo less than those buying similar cattle in Great Britain – arguing that only an urgent price lift can restore badly bruised confidence at farm level.
The implication is that Irish processors can put more money into Irish cattle at a flick of the switch but the IFA has failed to acknowledge the width, and depth, of premium differentiation on the British market where most certified Angus cattle are currently selling against an R4L base range of 400p-410p (456-468 cents), in-specification, beef cross, commercial steers and heifers offered this week in England and Wales were traded against a base range of 340p-368p (387-420 cents) while certified stock providing beef that can be sold under the premium winning “Scotch Beef” label are being purchased off a base range of 373p-382p or 425-436 cents. (sterling- euro = 1.14 cents)
(It should be noted that GB’s most recent all-prime average was a much lower 354p (403 cents). This calculation includes all cattle whether qualified for retail schemes or not.)
These differentials, or premia, which are universally reinforced by Red Tractor certification, were not achieved overnight. Scotch Beef is a PGI registered retail label for which only beef taken off cattle born, reared and processed in Scotland can qualify. Most “Scotch Beef” is sold in London
Similarly cattle whose beef is sold under a Certified Angus label must have been sired by registered bulls. A less well known Hereford retail scheme in the UK currently buys qualified cattle off a base of 360p-395p (410-453 cents)
And the value of commercial (not breed specific) cattle sold on the British market is further fueled by the delivery of increased numbers of supermarket specification stock. Their principal qualifications are UK-born, farm assured, UTM, maximum carcase weight 380-400kg and a McDonalds’ led insistence on less than four farm movements.
These cattle include Scottish PGIs and they always top the price range for commercial (non-breed specific) stock because fewer cattle are purchased flat rate and those not meeting spec are discounted.
The rewards for these efforts are beginning to be reaped at a cross-industry level because single steaks retailed in skin packs at exactly the same weight and price as others on the shelf are encouraging repeat purchasing and helping to counter the drag on overall carcase value created by so much beef being sold as mince.
Current estimates are that 54 per cent of beef offered through UK supermarkets is sold as mince. It may be that at 60 per cent of beef moving through the UK, including imports, exports, and cow beef is minced too.
These steaks can only be offered at the right thickness, an attractively modest price, and at a modest weight if they are taken off carcases weighing less than 380kg. Resistance to this development is still strong in Ireland and so the bulk of Irish beef offered in British supermarkets is currently sold as mince.
It also helps if the beef is matured, in most instances this is done over a 21-30 day period, so as much toughness/tenderness inconsistency as possible is eliminated – and both processors and retailers are only prepared to meet the cost of this if they feel confident about the size, weight, age, breed and overall provenance of the cattle they buy in the first instance.
If IFA calls for factories to reverse some of the price cuts of recent weeks are to be successful more of the cattle bred, finished and processed in Ireland are going to have to be targeted at specific retail export markets too.
Current Association hopes rest on shortening processor’s supplies by diverting more cattle through live export outlets.
But it is not the volume of cattle on the Irish market that is the problem. Breeders and feeders are not earning as much as they need to because too much Irish beef is offered as a second choice commodity on its most important retail markets – a situation not helped by many of its cattle coming to the market too old and too heavy as well.
Robert Forster is the editor and publisher Beef Industry News. www.rforster.com
