Meat industry facing difficult trading year as downturn bites

A DIFFICULT trading year for the beef sector was predicted yesterday by Meat Industry Ireland, which represents the processors.

It said cattle price levels are a reflection of challenging market conditions, which are likely to be a feature of 2009.

However, the Irish Farmers Association said the market facts as reported by An Bord Bia show that the factories could easily pay 15c to 20c/kg more for Irish beef.

Meat Industry Ireland said cattle prices are 10% down on this time last year, but this is little surprise given market conditions. However, prices are ahead of levels in the 2005, 2006 and 2007.

Cormac Healy, director, said Irish beef processors deliver on price when market conditions permit. Over the last five years, the cattle price has increased by almost 40%.

“The general view is that all Irish exporters need to gear their competitiveness to an environment of sterling weakness.”

This pointed to a continuing challenge to the competitiveness of Irish food exporters in the important British market.

“The impact of the global recession on consumer purchasing patterns is likely to intensify,” he said.

Mr Healy said in the first four months of this year the euro-sterling exchange rate has devalued 18% against the same period in 2008.

“If this remains the case for all of 2009, it would wipe €150 million off the value of Irish beef sales to Britain. Based on our export volumes to Britain this is the equivalent of 45c/kg or €153/head on a 340kg steer,” he said.