IFA president Joe Healy said the "serious issues around competition in the beef sector", highlighted in the PMCA report commissioned by IFA into the ABP-Slaney deal, have not gone away and must be addressed to have a sustainable and profitable beef sector for Irish livestock farmers.

The main conclusion of the PMCA report was that the market for farmers selling cattle is characterised by weak competition, and the ABP/Slaney deal is likely to weaken competition even further, through a "substantial lessening of competition".

Healy said farmers cannot understand why the Irish Competition and Consumer Protection Commission (CCPC) refused to investigate the case. He said: “The CCPC turned a blind eye to the serious competition issues in the Irish market for the purchase of cattle. They effectively washed their hands of the ABP-Slaney deal by leaving it to the Brussels authorities.”

The reality today is farmers are selling at a loss-making base price of €3.70/kg, with some factories claiming they cannot take stock for another week, at which point the price may be lower

IFA Livestock chair Angus Woods said livestock farmers are "extremely concerned" over the lack of competition for cattle. “The reality today is farmers are selling at a loss-making base price of €3.70/kg, with some factories claiming they cannot take stock for another week, at which point the price may be lower. At the same time, prices for the equivalent beef animals in our main export market in the UK are rising to £3.64/kg, or €4.30/kg, which is €220 per head more than Irish prices.”

ABP and the other shareholder in Slaney, the Northern Ireland co-op Fane Valley, have been pursuing this venture since the end of last year. The deal will see ABP control 30% of the country’s cattle kill and 40% of the country’s lamb kill.

ICSA

ICSA beef chair Edmond Phelan has said he is "dismayed" at news coming from the European Commission that the ABP/Slaney merger will go ahead.

Speaking following the announcement, Phelan said: “This decision will only add to the perception that the EU is good at regulating small enterprises but weak on big business.

“This, along with the EU’s inability to control the greedy retail sector has left Irish cattle and sheep farmers in an even worse position than before," he continued.

Farmers are getting squeezed from all sides when you also take into consideration the cost of inputs

"Farmers are regulated to within an inch of their lives yet we have seen no regulation further down the food chain, with the big retailers and processors making huge profits on the back of farmers who are lucky to break even. Farmers are getting squeezed from all sides when you also take into consideration the cost of inputs. Something is going to have to give.”

ABP Food Group and Fane Valley Group

Meanwhile ABP Food Group and Fane Valley Group have welcomed the decision by the EU Commission to approve the Slaney Foods joint venture.

Commenting on the decision, Frank Stephenson, CEO of ABP Food Group, said: “The joint venture will enable both ABP and Fane Valley, through the Slaney Foods joint venture, to grow our respective businesses by bringing a stronger product offering to international markets where we compete with much larger global players.

"Today’s decision, which follows a thorough evaluation by the DG for Competition at the European Commission, will allow the parties to enhance an already highly competitive beef processing sector in Ireland and to grow their main export markets through the joint venture. This transaction has always been about securing better international markets for meat products and developing an industry that needs to evolve to remain relevant and compete effectively on the global stage.”

This is a positive outcome for the respective businesses

Trevor Lockhart, CEO of Fane Valley Group, said: “This is a positive outcome for the respective businesses and a step in the right direction for the red meat industry in Ireland. It is imperative for the long-term sustainability of the sector that we develop highly effective business models that maximise the opportunities to sell quality beef and lamb from Ireland in the international marketplace. That has been the combined goal of ABP and Fane Valley from the very outset.”

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