November 27, 2008
Further price increases needed for UK's beef sector
The latest Eblex Business Pointers say UK beef farmers need to see a further increase in farmgate prices to enable them to invest with confidence in their businesses.
UK's National Farmers' Union (NFU) livestock board chairman Alistair Mackintosh said: "Despite the marketing interruption of bluetongue and foot-and-mouth disease in 2007, some enterprises have responded to messages on efficiency over the past few years and are generally making improvements in terms of physical performances, and have achieved better gross margins for their efforts."
Still, the majority of beef businesses were still showing a negative net margin, with Less Favoured Areas (LFA) beef farms fairing worse than in 2006/2007, was extremely concerning for the industry, he said.
The NFU was aware that any efficiency savings had been offset by escalating input costs and the low farmgate prices throughout 2007. Therefore, it had to highlight the critical situation of the livestock sector to both retailers and processors in discussions in upcoming weeks.
Mr Mackintosh said: "The simple fact is that the only way out of this situation is to see a continued gradual and steady increase in farmgate prices in order to maintain a sustainable and profitable livestock sector to allow for reinvestment on livestock farms."