February 10, 2011

UK beef prices drops below production costs

UK's National Farmers' Union (NFU) beef group has appealed through an alert to the whole of the supply chain to support Britain's beef farmers, as prices continue to plunge below production costs.

NFU livestock board chairman Alistair Mackintosh said: "The current situation has been compounded by Defra's Farm Income forecasts which don't make for pleasant reading for beef producers.

He said that incomes are expected to fall significantly this year. Feed, fuel and fertiliser have also seen a sharp rise and this trend is likely to continue.

"Beef prices at their current level are unsustainable - prices are nowhere near the cost of production and farmers are currently receiving on average just 48% of the final retail price for their beef," he added.

He also mentioned that the current economic situation is understandably faced by consumers, and the pressure on retailers to provide cheap food, but the UK livestock sector is facing a most serious challenge with producers questioning their future in the industry.

"This supply of foreign meat simply is not guaranteed - production in Ireland looks set to fall and prices of beef from Brazil are on par with some countries in Europe; less beef is being exported," he said.

"We are calling for processors and retailers to provide producers with fair and sustainable prices in order to ensure the viability of the industry," Mackintosh continued.

He also mentioned that if abattoirs and retailers want to guarantee their supply of British beef for their customers into the future, they must act now.