William Aird: Farmers Losing €350 as Beef Prices Collapse

Okay, Deputy Mayor. I just want to welcome everyone here today and I read your open statement and can I just say, like you Comhairle, it's a lovely day out there today but I can tell you one thing, there's very dark clouds over the whole fattening in Ireland at the moment and the whole beef industry if you don't mind me saying so. I'm going to just open my remarks by giving you just some statistics that's where we are at the moment alright. This time last year bulls were making £7.95 right. Bulls were killed on Monday, you know a person that killed bulls at £6.70 and today they're quoted at £6.40. You can see what those cattle, you know what that particular person, farmer or an individual like you and I and anybody else here today that's farming, you can see what they're losing right. I'll give you another statistic. Cattle bought in and I would say at 2.4.20 in October, November, sold out in March at the very same price, actually 20 euros less than made 2.4 right. Those cattle had to be fed and I'm talking about just feed at £3.50 a head. Nothing else, just £3.50. They're down £350 a head right. So what is the person to do when the traditional farmer that we're always talking about, who is the family farmer? Well here is the family farmer that traditionally had a suck their herd last year, everyone was a good drummer, they got a great price with it. Now we're being told that it was a flip alright. I know people that got out bull heifers back into the game again delighted with themselves, now they're back to square one and maybe even in a worse position than they ever were alright. You take it into what's happening now, you have the factories coming in, contract rearing where I as a farmer can go out and just rear the cows for the farmer and that's the way it's going. So where is the family farmer going to be? The old traditional way is going to die and die completely because there's so much fertility in the market that no single farmer can carry that burden and we'll see it today. And can I say this, we talk about being bored being audited, for what? Now look at the market being flooded with Australian beef and all different other countries, Brazilian beef and everything and none of them audited. And we're audited here producing the best beef and here's what we're getting now, the slap in the face like that with our beef losing 350 and four years ahead. I just want the people to understand the pressure that's out there at the moment, the human mental pressure that this is causing to people. And I just want to ask a few questions but I'm giving that from the heart, speaking on behalf of people that I spoke to, that are at their wit's end for the last three weeks and a month and these are young farmers that we are encouraging to farm. And it's such a fertility market that you can't tell me where we will be this time next year. Nobody can tell us, nobody could tell us that beef would be at the price it is today at a quotation of 6.40 and going down. And if I said to you where is it going to stop, you won't be able to tell me. Nobody will. That's the market that we're living in and that's the way that these people are being asked to farm, straight up to you. But I would just like to ask a couple of questions to you. If cattle prices are historically strong, can you specify a theory what proportion of the retail beef price is actually returning to the primary producer, the farmer, versus retained and processing and retail margins? And a quick answer to that, because I have much time. What proportion of the retail price is going back to the farmer? Well, I don't have a calculation for that figure, but let me just come back to where you started and then I'll try and work my way around to answering that question. You've given us exactly our assessment of where we see this market. You've talked about volatility and volatility is acutely extreme at the moment, in this short period of one year. It has gone from a situation where at the end of 2024, and you'll remember this from the farming market... Sorry, I have to ask the same question. I can't wait with time. I've only got three minutes left and I know exactly what you're going to say to me. But you've talked out all the issues and I'm trying to explain to you that that is exactly what we're feeling in the market. And what we're seeing in the market is a complete downturn in the value that's coming at processing level from retailers and wholesalers. You can see what's happening because they're bringing it in without it being audited. So the impact of the... No, I'm sorry, I want to ask you the next question, all right? No, I'm sorry, I don't want the answer from that. I have to ask you. Well, are you going to give me extra time? I'll give you extra time to give me a chance to answer. No, be fair to me now. I have very serious questions on behalf of the people out there. Go ahead. Please don't give me the time. Please go ahead. Deputy, I'm happy to step in. If you look at the Agri-Food Regulation and the work the Agri-Food Regulation has done over recent times, we've had very significant engagement. So there's a lot of public available information there now that shows the selling price of the beef leaving the factory. So if you look at what's happened, the hindquarter selling price has declined from about €9.64 last September to about €8.75 today. So that's closely matching, you know, the fall, the decline in cattle prices over that period. The forequarter is the same. It hasn't quite declined at the same rate. And that's because most of the high retail, the high value cuts, as you know, are from the hindquarter. But we're seeing challenges now in the manufacturing beef market also. So those forequarter prices are going to fall back. And that is the evidence. That is the evidence that shows the challenges in the marketplace at the moment. Can I go on to my second question? Are you giving me more time? I want the answer to that. Keep going, you're within time. Oh, yeah, but like, I mean, the answer, like, I got that answer. The farmers losing €350 to €375, all right? How much is the factory losing? That's the answer I'll give back to them, all right? My second question is, given that MMI represent 28 processors, which you do, right? 28 sites. How do you respond to repeated farmer concerns that a small number of processors effectively set the price in a highly concentrated market? What's your answer to that? Yes or no? Farmers, processors follow market signals. Processors, if you look at €25, and don't tell me that's not relevant, because it is. What we saw was the return to farmers. You saw where the prices went from €5 to €750 or thereabouts. That was following what was happening in the market. So the proportional payback to farmers is represented in those historically high figures. The very opposite, the exact opposite happened at the beginning of this year, where those wholesale prices dropped back quite significantly along the lines of the figures that Dale has mentioned. And there was a proportionate response to that in the marketplace. And bear in mind that every European country, including the UK, who is not in the European Union, has seen the same fallback in prices that we have. This is not uniquely Irish. This is European. It's across the globe. Everybody is doing the same thing in the market at the moment. Because everybody is facing the same market environment. What kind of a position would we be in if we didn't have, and I want to acknowledge publicly, the work that the live exporters do in this country. And I want to thank them for the work they do. We sent out over 300,000 cattle out of this country this year. And we sent out... I don't have the figure of the calf exports, but I can tell you... Use the extra time for questions. No, but I'm just saying it. My next question is... Farmers will argue at the moment that the recent price drop was sudden and severe. What specific actions did processors take to avoid passing volatility and disproportionality onto the primary producer, the farmer? Well, go on. We acknowledge the challenges in the marketplace at the moment. That's very clear. If you look at the sheep price and where it's at at the moment, it has continued to go up very high. And that's in response to market demand. We have the Eid festival at the end of the year. So it's the exact opposite as happening in the beef sector recently. The demand simply isn't there. There's beef going into cold storage at the moment. As Philip said in his opening statement, we've seen beef steaks and beef joints decline by 37% and 70%. That is really, really significant, is what has happened in the marketplace. The consumer has ultimately pushed back against the high price of beef in Europe and the UK, and we're seeing a market correction at the moment. And that's the basic reality of what's happened. That is difficult. We understand it's very difficult for finishers at the moment. They obviously had a very good year last year, when prices went up very high, and it's a very difficult year for them at the moment. You'll take half your salary next year. No, you wouldn't. You know what I mean. It's a bit of an irrelevant question. It isn't. It is. We acknowledge the difficulties the farmers are facing. It was 350 this year. You were telling us if you made it last year, which you didn't, it was up around 200, right? So therefore you're in a negative situation straight away. But anyway, my next question was, can the MMI commit to full real-time transparency on pricing formulas? Contract structures and export returns to farmers can independently verify how prices are set? Yes. And that's right through the regulator. The regulator will have additional powers next year, and we will comply with that. And we have complied with every request that has come from the regulator, and that can be independently verified as well. If 90% of the beef is exported, how do you justify the claim that Irish cattle prices are fully market-reflective when Irish farmers have no meaningful domestic price-setting influence? So we do export 90% of the beef, Deputy. You're right. Therefore, we're very reliant on what the market demand is in the international marketplace. It won't be driven by what's happening here domestically. It'll be driven by what's happening in the main market. 48% of our beef goes to the UK, 48% goes to the EU, and we have a very small percentage that goes to third-country markets outside that. So, by and large, the price of beef, what we get, is determined by that marketplace. Not how many cattle we kill here domestically, not other issues that you're making reference to. It's the marketplace in Europe and the UK in the main.