THE LONG term sustainability of UK beef production is now under real threat from the continuing low beef price.

Issuing a joint ‘wake-up call’ to the supply chain, livestock chairmen from the farming unions of Scotland, England, Wales and Northern Ireland this week united to warn that a continued year-long decline in the beef price had left producers operating below the cost of production – a cost likely to escalate on the back of rising feed and bedding costs this winter,

But, while backing the unions’ move, the Scottish Beef Cattle Association predicted that their call for a fair price would fall on deaf ears – and producers should concentrate on how to help themselves.

The unions’ joint statement said: “We hear the right signals from the supply chain about the need to secure supply on a long-term basis but the short-term approach currently being taken illustrates that the market is failing to deliver.

“At current prices, beef producers will be unable to afford to produce beef this winter and some are starting to seriously question their future in the industry.

“While retail demand for beef continues to remain strong, we have seen this correspond with increased supply. Retail sales are up on the year, however this has been driven by promotions and the retailers need to look at ways to re-balance the carcase and ensure producers receive more market share,” said the statement.

“It is imperative that the supply chain gives the right signals through long-term commitments to a sustainable price. This is the only way to give producers the confidence to go forward, go to the expense of finishing cattle this winter, and deliver what the market demands”.

It added: “In order to instill confidence and drive sustainability, the retailers and processors have got to start backing up their claims of commitment to UK beef farmers.

“It is clear that the UK consumer wants to buy UK beef; they recognise its quality, our stringent standards of animal welfare and the huge environmental benefits of UK beef over imported products.

“This really is a wake up call; producers must start to get a fair share of the retail price if they are to remain in production.”

SBCA’s Brian Simpson commented: “We support the concerns voiced by the UK farming unions, but one thing is certain – no wholesaler or retailer is going to pay a penny more than he needs to as they struggle to make their own margins, so we need to concentrate on what we as beef farmers can do to help ourselves.

“The first step is to forward budget your beef enterprise. Make realistic estimates of prices you will pay for all major inputs – purchases of store cattle, feeds, and fertilisers.

“Also make realistic estimates of stock losses and other contingencies. If you cannot make it work on paper at this stage, then you are trusting to luck that input prices will fall or finished prices rise above current levels to leave an unexpected profit,” he advised.