Institute backs call for improved beef market returns
21/02/05

Long standing National Beef Association convictions that beef production can only be profitable if missing coupled subsidy income is quickly replaced by a combination of sensible cost cutting and improved market returns have been backed by the Agricultural Research Institute of Northern Ireland (ARNI).

Its specialists have spelled out that over 2004 the total subsidy received by beef cattle was the equivalent of 116p per dwkg and because only around 38p can be realistically recovered through the introduction of new production efficiencies are stressing that a market average of 249p per dwkg for slaughter cattle is essential if pre-decoupling production levels are to be maintained.

"We welcome ARNI's timely entry into the urgent argument over the need for an immediate and significant jump in market returns and hope its contribution will help to persuade processors and retailers that it will be impossible to safeguard their beef supplies unless they show more appreciation of the income difficulties facing UK beef farmers than they appear to do at present," said NBA chief executive, Robert Forster.

According to ARNI farmers can make their own contribution to future survival by selecting the most fertile suckler cow types and putting them to terminal sires that produce calves with the highest carcase value.

Then this has to be backed by strong management which focuses hard on reducing the herd calving interval, buying replacement heifers with robust maternal traits, either making better silage so more expensive concentrate feeding can be reduced or trying out cheaper forage maize, and better grassland management.

"ARNI estimate that by selecting the most effective combination of these improvements the cost of producing finished calves on a typical breeding/feeding unit could be cut by 38p per dwkg," said Mr Forster.

"However it also makes it clear a market average just short of 250p is also needed to compensate for the removal of coupled subsidy and secure ex-farm production at the level needed to maintain current levels of slaughter sector throughput."

"Its analysis applies to beef production across all parts of the UK and fully supports our contention that it is impossible for the beef sector to continue as it has done in the past, never mind prepare for the future, unless there is a quick, and significant, lift in market income."

"Slaughterers and retailers need to realise that production is already moving into slump because breeders and feeders are not confident about receiving a proper return from the market."

"Farmers will not use their SFP to make up the current 100p -120p per kilo gap between market income and the cost of production, as many elsewhere in the industry hope they will, because they need to invest it in establishing the new production efficiencies that ARNI, and other specialists, recommend."

"And the quicker this is understood by those who depend on the continued production of safe and secure supplies of UK beef cattle for their businesses the better."