Falling prices push beef industry to breaking point
Published:  21 July, 2014

The “‘sword of Damocles’ is hanging over the beef industry” due to falling prices and a lack of retailer support, according to the chairman of Hybu Cig Cymru (HCC), the meat promotion body in Wales.

In an address at the Royal Welsh Show, Dai Davies addressed visitors with strong words regarding the current British beef crisis which has seen the price of beef plummet: “It’s not an exaggeration to say that the sword of Damocles is hanging over the beef industry.”

In his address Davies highlighted the lack of commitment from British retailers to support the British beef industry after the horesemeat scandal last year. Davies said: “They promised that beef would be largely sourced from the UK, rather than risk obtaining their meat products from abroad and possibly from untraceable sources. To their credit, many of those retailers stuck to their word. Unfortunately, that’s not the situation in all cases.

“I would suggest they all have a duty to act responsibly and to play a positive role in not only maintaining but encouraging a flourishing beef industry in this country. Our message to the entire retail trade is simple - use our products or lose them.”

Davis also expressed concerns over the quantity of imports in the UK market: “Large quantities of imported beef products are now present in some UK retailers and we must presume – for want of a better explanation - it’s because it’s a penny or two cheaper than our own produce.

“At the same time the retail price of beef has risen – it’s four per cent higher this year than in 2013. So Welsh and British farmers are receiving less for their beef cattle while consumers are paying more.”

HCC also revealed interim findings of an independent review of the Welsh beef industry. Chief executive Gwyn Howells said the report was commissioned as a result of the crisis. He said: “The beef sector in Wales and across Britain is going through a difficult period, with farmers receiving up to £300 less per beast than they were just a year ago.”

Recommendations in the report included: increasing intervention to improve fairness between various parts of the industry – farmers, processors and retailers; developing contracted, co-ordinated action between producers, processors and retailers to satisfy customer demands; and ensuring healthy competition between complete supply chains, rather than between various stages of the same supply chain.

However, Howells said more research needed to be conducted before the report was published in the autumn: “While the interim report is very much a work in progress, it does put forward a range of concepts which need to be investigated further.”