Prices ‘Threaten Beef Sector Survival’

By Dan Buglass rural affairs editor

THE Scottish Beef Cattle Association yesterday warned both supermarkets and the processing industry that they must pay farmers a fair price or risk the industry losing critical mass.

The announcement came days after the Competition Commission demanded that two leading supermarket chains hand over the details of thousands of e-mails between them and their customers.

Jim Kennedy, the chairman of the SBCA, said: “We need to be receiving support across the board from abattoirs to instil confidence into a diminishing sector. The continued importation of beef products may well fill supermarket shelves, but it will not lead to the production of reliable numbers of Scottish cattle in the longer term.

“Short-term processing gains from the supply of inferior cattle will result in the destruction of the industry.

“Many supermarkets now have pictures of producers of their packs of beef, but what does that really mean for the farmer and is he guaranteed a fair price to cover production costs?”

Scottish finishers of quality prime cattle are currently receiving about 220p per kg deadweight. That is 10p ahead of the trade in England and Wales, but Kennedy says it is nowhere near high enough. He might have also pointed out that as far back as 1995 the average for all steers in Britain over the year was 227.7p.

Kennedy added: “If there is no tangible economic improvement from the processors to farmers, why should they continue in a relationship where the only outcome will be an increased overdraft?

“Meat plant operators and the supermarkets must acknowledge the true costs of production and pay accordingly. Now is the time for the processors and supermarkets to put stability into the marts and deadweight sector as primary producers are facing difficult trading conditions for their suckled calves.”

Following the reforms of the Common Agricultural Policy in 2005 there has been a slow decline in the Scottish suckler herd – the cows that are predominately run on the hills and uplands. The national herd stands at barely 490,000 cows, down by about 5,000 since 2005, and way short of the 512,000 cows in 1995.

There is little doubt that if breeders do not receive a decent price for their calves at the autumn sales there is likely to be a major exodus from the breeding sector. Those farmers who regularly buy calves also face a sharp increase in feed costs this winter, with grain prices up at least GBP 40 per tonne on last year. They will either have to buy calves cheaper or be guaranteed a much higher price for their prime cattle at point of slaughter.

Meanwhile, Paddy Wall, the chairman of the European Food Standards Agency (EFSA), is showing growing concern at the alleged importation of Brazilian beef from provinces in that country where foot-and-mouth disease (FMD) is present.

Wall said: “FMD is not a disease affecting human health. However, that does not mean it is of no concern to us. It is a dangerous disease for animals and a major threat to trade.”

In May a delegation from the Irish Farmers Association (IFA), including the journalist Justin McCarthy, visited Brazil and were horrified at the lack of traceability and movement breaches they found.

Wall said: “The issues raised by the IFA, claiming that there is movement of cattle from FMD regions to other parts of the country which are clear of FMD, need to be verified. Officials from the Food and Veterinary Office in Brussels will visit Brazil in October and report on any non-compliance.

“With the agriculture committee in the European Parliament calling for action, the European Commission will not ignore the findings of its own auditors.”

John Cameron, president of the SBCA, said: “It is highly significant that the chairman of EFSA is concerned at the apparent lack of compliance in Brazilian imports. Perhaps at last we will now get some action.”

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