There are a lot farmer cattle finishers who have contracts in place with factories on prices that are ahead of the going market rate, but these contracts are not something that all farmers want, according to Meat Industry Ireland’s (MII) top brass.

“A lot of farmers do have contracts and they are paid above the market rate at that time when they go to sell their cattle, and that might even have been referenced in the farming media recently, so you know that is the reality that is happening out there,” MII director Dale Crammond told the Oireachtas agriculture committee.

The MII boss and ex-Department of Agriculture official said that these contracts are “very focused on the winter finisher” and generally cover a six-to-seven-month window when cattle are finished out of the shed.

MII’s chair Philip Carroll stated to TDs and senators that the full detail of these contracts are not something that processors would be willing to disclose.

“We don’t know what the nature of those contracts are because that’s a commercial matter for individual companies,” Carroll, who was also formerly employed in a senior role by the Department, said. “You weren’t going to find that out between a farmer and a processor, nor a processor and retailer. That’s off territory from our perspective here, but I can tell you that there are significant contracts, not all farmers want contracts, not all farmers look for contracts.”

Carroll sought to pour cold water on the prospect of a short-term beef price turnaround, saying that a stockpile of beef has been built up despite factories working at 80% capacity over recent months, rather than at full capacity is expected for the opening stage of the year.

“There isn’t a cold store in the country that you can find capacity to put processed product and I had that fully verified,” he said.

Reactor payments

The MII witnesses appeared to be caught unawares of the arrangement beef factories have with the Department of Agriculture on the payment regime for TB reactor carcases and whether processors pay anything for them.

“I’m not sure of that. I know there’s an insurance scheme there that farmers can opt into, that if certain animals are condemned in the factory, the farmer will get paid for those animals,” Crammond said in response to a question from senator Joanne Collins.

The meat industry body was to revert to the committee in writing with a full answer on their paying arrangements with the Department for reactors.