This week’s Beef Forum didn’t deliver any headline-grabbing announcements, though hearing details of the ever-increasing supply position ,as reported on by Darren Carty, will be worrying for farmers given the prices this autumn.
In his update, the minister outlined significant progress in the approval process for China that he chose to keep low profile. Otherwise it was very much a case of the parties sharing information on what is ongoing, which although itself useful, doesn’t inspire confidence in farmers to expect a significant rise in prices.
Meat Industry Ireland (MII) introduced its policy paper. This document does a fine job at describing the achievements and investment over the past decade, and has strong views on how farmers need to drive efficiency. It is also strong on encouraging the department to invest further in market access work, which again will be supported by everyone involved with the beef industry.
What it fails to do is outline a vision for how Irish beef factories will move Irish, predominantly grazed, beef into a premium category – particularly in the UK market.
Bord Bia outlined the promotional activity it is engaged in across the main beef export markets. Looking at relative cattle prices across these as well, we have to conclude it has made a much greater impact in continental markets than in the UK. Whatever we say about the impact of weak sterling this year, last autumn the exchange rate was 70p/€1, and the price differential rose to €1.20/kg.
Perhaps it is a question of resources – the UK is a market worth over €1bn annually, and given the weakness of Irish beef prices secured there, it is clear more fire power is needed.
We have to accept that consumer preference for the domestic production will drive a premium, but we should aim to be within touching distance of it. The MII report would have benefited greatly if it had addressed this issue and presented a vision on how Irish beef could be better sold and marketed. IFA president Joe Healy has been critical of the industry recently for underselling.
Progress on China
As well as recapping on schemes outlined in the budget, the minister gave an update on market access and trade mission activity. Buried in his report was a significant nugget on progress in China, which brings that market a step closer.
Back in January, Chinese inspectors visited Ireland to inspect the control systems that were in place for the beef industry. Their report was expected by the spring, but that didn’t happen – the Chinese work at their pace, not the pace Irish farmers or factories want. Minister Creed led a mission to China in September and the report has now been received, which enables the approval process move to the next stage.
It is understood DAFM has dealt with these, so the process moves on to agreeing protocols and certificates, with plant inspection visits – the final leg in the process – expected to take place in the first half of next year. Given the hype surrounding previous progress reports on China, this was understated to say the least. Given the size of the Chinese market, as illustrated by taking almost half of Brazil’s exports, amounting to 36,000t in October, it cannot come soon enough to help address the supply of cattle coming on stream in 2017.