Farmers ‘losing out across all grades’
“They are losing across virtually all grades, even though there is a temporary reprieve until later this year on some of the grade four plus animals,” he told the Joint Oireachtas Committee on Agriculture, Fisheries and Food. But he said he was confident that the QPS is cost-neutral or better for farmers. “The other factor that would leave the grid significantly better is that the better grades that are benefiting from the grid have higher carcase weights than the poorer grades.”
“U grades would have a heavier carcase weight than R grades, which are heavier than O grades, which are heavier than P grades.”
He said the change to a 15-point scale which replaced the old five-point model in the payment grid was necessary to reduce the price impact from grade to grade for cattle.
The steps in the new grid are based on three six-cent progressions within a grade. “If the meat industry had continued to use the old system of E, U, R, O and P grades, a move from an R to a U grade would result in an 18 cent per kilo bonus. If the move was in the opposite direction, there would be a reduction of 18 cent. That is too great a tipping point in respect of animals that might be at the margins.”
A reprieve will remain until October for 4= carcases, and until next month for 4+ carcases.
“The purpose of these modifications is to ease the impact the grid will have during its first season in operation,” said Dr O’Mara. “We did not have a role in respect of the negotiation of these modifications.”
“Without any of the modifications, approximately 61% of the cattle in the 2008 national kill were better off and approximately 39% of them were somewhat worse off. Under the current system, there will be somewhat more winners. The stock that gained are those that are higher up the conformation chain and that were hitting the middle boxes for leanness.”
