Ireland and UK beef price gap doubles

The beef price differential between Ireland and the UK has doubled in one year due to the introduction of the new beef price grid.

Irish Creamery Milk Suppliers Association (ICMSA) beef committee chairman Kevin Connolly said Irish beef prices had fallen by between 5.5% and 9.6% below the levels achieved this time last year, while UK prices had only fallen marginally by between 1% to 2%.

The gap between Irish and UK beef prices has doubled from about EUR60 (US$81.8) per head in February 2009 to EUR125 (US$170.4) per head in February 2010, and that is in addition to the losses the new grid is imposing on most farmers, said Connolly.

There is now a full re-assessment of the farm enterprise mix on many farms, particularly dairy farms, he said. Given the poor beef prices and the losses under the grid, hundreds if not thousands of farmers are selling their calves at two to three weeks as opposed to keeping them for two years, and making a loss to subsidise the factories and retailers.

In the first six weeks of this year, ICMSA calculates that 11,062 dairy calves have been exported, which represents a 161% increase on the 2009 level.

Connolly called on the meat plants to immediately raise their prices if they are to convince farmers there is a future in the beef business.