TALKING DOWN CONFRONTATION

NFU president Peter Kendall says the farmer is being paid no more now for beef cattle than in 1989 but EBLEX chairman says everyone should remember that supermarkets are operating in a ferocious trading environment.

DISAGREEMENT BETWEEN retailers and livestock producers remains a possible ?aw in renewed con?dence and optimism from the lifting of the ban on UK exports of cattle and beef. A second 'beef summit' to discuss the future of the British beef trade was held at DEFRA on the morning of the lifting of the 10-year ban and attended by livestock producers, processors, wholesalers, caterers and retailers.

Those at the meeting did agree to set up the English Beef Export Group to coordinate promotion of beef and beef products abroad with EBLEX and other industry bodies. Overall, the meeting was a demonstration of the willing-ness for all parts of production and distribution to work together, said Minister for Sustainable Farming and Food, Lord Bach. "I think they can work together, but I don't claim there will be no tensions in the future," he said.

NFU president Peter Kendall said that lifting the ban was a 'red letter day' for farmers and opened the way for restoration of a trade worth £600 million annually. However, in March farmers' average price was 195p/kg at the farm gate while average retail price was 428p/kg.

"The farmer is being paid no more for beef cattle now than was the case in 1989. The NFU would like to see supermarkets reducing pro?t margins while paying a fair price to farmers for a quality product and not raising beef prices to consumers." EBLEX chairman John Cross said that everyone had to remember that supermarkets were operating in a "ferocious" world of trading and meat, while beef particularly was a lead product with which the retailers compete.

Cross said there had to be a limit on the adversarial business and the distribution chain could not operate on confrontation. When the ?rst beef summit was held last October prices were in the doldrums and created nervousness." Consumer demand has been robust since then, he said.

Moreover, EBLEX's promotion of beef mince had helped to ease the introduction of over 30-month-old cattle into the market without ruining domestic price.

Caution was required when predicting how the opening of exports would affect beef price, he said. It was a competitive and price sensitive business and it would be "naive if not optimistic" to predict UK prices for home killed beef now.

Realignment between UK and EU was expected and the export market would strengthen due to more players competing. A lot would depend on how the Irish react, particularly if they start discounting, said Mr Cross.

The South Americans were hampered by health problems and political barriers. He predicted a narrowing of difference between UK and EU but said there would be a natural self-levelling as home-killed beef prices closed in on EU levels. "It [price of HK beef] will ?rm and the harder it becomes the more marginal exports will become."

Cross predicted exports this year will be about 30,000 tonnes or about 17% of the tonnage of around 180,000 tonnes of beef exported annually 10 years ago. The Southern Mediterranean is a target market for UK exporters, he said, as there is a de?cit of 600,000 tonnes of beef in the region. Following the announcement of the lifting of the ban, Cross and Lord Bach left for Italy to attend the CIBUS trade show at Parma followed by a promotional dinner featuring British beef in Milan.

"The market there had been good for young bulls with pale muscle and light fat cover," said Cross. As the two boarded the ?ight, meat trucks were following them south going to Greece. Another order, this time cow beef, left for the Netherlands.

France is another target market and EBLEX is to hold a beef convention in Paris in June where 18 British processors and exporters of beef will meet 42 importers who will specify the kind of meat wanted. "The French market has changed signi?cantly over the past 10 years," said Cross.

There are restrictions on the beef and livestock that can be exported. Neither cattle born before 1 August 1996 nor beef or beef products from cattle slaughtered before 14 June 2005 are allowed. Beef which has meat from the vertebral column or products made from it taken from cattle slaughtered before 2 May 2006 are still banned. EU and UK law on Speci?ed Risk Material [SRM] is now harmonised which means that bovine veterbral column classed as SRM will be reduced from 30 months to 24 months.

The Food Standards Agency is to allow authorised butcher's shops to make use of the EU derogation to bone out the spinal column for cattle aged from 24 to 30 months.The new rules also allow the reintroduction of beef cheek and other head meat but only from licensed cutting plants.

Live cattle cannot be exported from markets, only direct from farms or from "assembly centres", said Frances Radcliffe, Defra's head of beef exports and testing unit. Lord Bach said all reasonable measures would be taken to prevent protestors disrupting the live cattle trade. There was no reason for protest, he said, as welfare standards had improved vastly over 10 years.

Moreover all veal crates will be banned throughout the EU from the 1 January 2007.According to Liberal Democrat spokesman for food, Roger Williams MP, nearly 275,000 tonnes of beef was exported from the UK in 1995 the year before the ban and there was a livestock trade worth £75 million for 426,000 calves and 10,500 older cattle sent abroad.

EU welfare requirements of a maximum of nine hours driving followed by one hours' rest then a ?nal nine hour of travel has been set, he said. "315,000 pure bred male calves from the dairy herd are now slaughtered at birth every year because little demand for veal exists in this country," said Williams."These calves could be exported to properly accredited veal units on the Continent."

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