You would have to suspect that if beef prices were currently at levels seen last June (around 320p/kg), there might have been more concerns raised by farmers about the proposed deal between ABP and Linden Foods.Assuming the deal gets past competition authorities, it effectively means that between them ABP and Linden will control about 40% of the cattle kill in Northern Ireland.
You would have to suspect that if beef prices were currently at levels seen last June (around 320p/kg), there might have been more concerns raised by farmers about the proposed deal between ABP and Linden Foods.
Assuming the deal gets past competition authorities, it effectively means that between them ABP and Linden will control about 40% of the cattle kill in Northern Ireland.
That leaves approximately 13% with Dunbia, something similar with WD Meats, about 25% with Foyle (Omagh and Campsie) and the remainder picked up by Primestock Meats and Lakeview Farm Meats.Given that Dunbia and Foyle traditionally have avoided competing directly with each other for cattle, future options are fairly limited for beef ?nishers.
Yet, what the last few months have shown is that if the dynamic of demand moves ahead of supply, there is enough competition there to ensure improved returns are passed back to farmers.
There is no reason to think that the proposed deal between ABP and Linden will have a negative effect on the market in the short term.
But in the longer term, it is important that competition remains – take the example of the south of England, traditionally the lowest beef price region in Britain mainly because of the lack of alternative outlets for cattle.
Before being too critical of meat plants, it should be pointed out that they tend to operate on thin margins. And in European terms, the price paid for beef here is extremely competitive, with NI R3 heifer prices currently third behind Sweden and Britain.
Compare that to the position of NI milk prices in a European context.
Looking at data for April 2017, and at an average milk price in NI of 26.05p/l, we lie in 22nd place, and 3p/l to 5p/l behind most of Europe’s main milk-producing countries.
That same 22nd place in the beef price league is a price of around 220p/kg.
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