'More obvious than ever' beef grid 'serves factory bosses' - ICSA
The Irish Cattle and Sheep Farmers' Association (ICSA) has claimed that the beef price grid used by factories to determine prices paid to farmers "is structured solely to serve factory bosses, not primary producers".
John Cleary, the association's beef chairperson, said that beef processors were "reintroducing" grid pricing after several months of paying historically high prices for cattle.
Cleary claimed that this is an attempt to "manipulate prices under the cover of a short working week".
"Between this week, next week and the May Bank Holiday, [processors] are clearly trying to flush out numbers.
"Meanwhile, their agents are out in the marts paying as much as €8.80/kg to €9.00/kg for finished cattle. That tells you everything you need to know about how strong market demand is, and how much room there is to pay farmers properly," Cleary added.
According to the ICSA beef chair, the reversion to beef grid pricing is an attempt to "pull prices back in what is clearly a buoyant market".
"For the past five months or more, factories have been paying flat prices to secure stock from farmers because of the strong market demand that we know is out there," he said.
"Now, in a blatant move to rein in prices, they are reverting to the beef grid system in an effort to regain control and suppress what's being paid to farmers," Cleary claimed.
"There hasn't been a sign of the grid in the sales ring or in meat factories for the past six months, while processors were scouring the country to secure supplies.
"It is more obvious than ever that the grid is structured solely to serve factory bosses, not primary producers," he commented.
He labelled the beef price grid as a "malfunctioning pricing mechanism that has consistently shortchanged farmers".
It's time to change that. Farmers deserve a fair, straightforward system that reflects the real value of beef, not one that allows processors to shift the goalposts whenever suits them," Cleary said.
"The time has come for all farmers to stand together and demand a more simplified and transparent pricing system," he added.
This week’s factory quotes for finished beef cattle sees outlets that were at the higher end of the trade last week move to reduce their prices for this week, while outlets quoting the lower rates last week have held their prices.
After weekly beef price increases of up to 20c/kg/week and above since the start of the year, the move by some outlets to hold prices and others to cut prices was described by one factory agent as a “reality check” for the trade.
Most factories will be only killing four days this week as a result of Good Friday on April 18 and four days next week due to the Easter Monday bank holiday on April 21.
Some factories reduced their kill to four days last week also. The reduced kill has eased the pressure on procurement staff to fill out kill sheets.
