October 27, 2008


Economic meltdown may lead to better Irish beef prices



The big companies in Ireland that have dominated meat sector prices may no longer be able to wheel their power as the economic crisis and beef shortage could slacken their grip to the benefit of farmers and smaller processors and abattoirs.


This was the view of Stephen Aitken, auctioneer at Darlington mart in Ireland, stating there will be a "big change in dominance both here and in the Irish beef sector" as big companies governed by shareholders who demand profits will not have the flexibility of farmers and smaller outfits.


Aitken believed farmers will be in a stronger position and said: "We do not want to be dominated, we have had hard enough suppressed times and need better times."


In his address to the North-East regional livestock board of the National Famers' Union in Darlington, Aitken said the loosening grip of the big companies was seen earlier this summer when the Irish tried to force down market prices.


Their attempts were stopped in their tracks because the shortage of supply pushed prices back up.


He believed this year's rising prices had seen some confidence return but warned there was a need to sustain cattle numbers as there had been a big reduction in breeding stock and an increase in the number of young cows going being culled.


He warned that could have a dramatic effect on future stock numbers, especially as the number of prime cattle going forward had also increased.


Aitken believed schemes were needed to encourage hill farmers - and even dairy producers - to stop culling.


If cattle numbers continue to decline, other countries may see it as a weakness and take the opportunity to export here.


He believed one reason for a slight dip in prices was an increase in the number of under-finished cattle going forward. The killing out percentage was smaller and, therefore, the price.


The economic climate had resulted in much more mince and stewing meat being bought at the expense of joints and steaks.


It was a move back to basics - the way our mothers used to do it – and one which would continue, said Aitken.


He added that Japan and China offer opportunities for beef exports, particularly of the more expensive cuts.


On the other hand, Aitken felt the reduced beef production in Brazil would remain as there was now a big switch to growing sugar cane for bio-ethanol production on land that was previously grazed.

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