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DEAR SIR:
It is with deep interest I am following this beef farmer compensation saga. There seems to be a theory that only finishers are entitled to the compensation or most of it anyway.
Their reasoning is that they have accumulated the largest losses. However, this is questionable. The reason of extra feed costs should not be a factor. Before any farmers put cattle into a shed last autumn, we all knew that ration prices would be €40-€60/t higher. You then have the fall in beef price.
The store price was back by at least the value of extra feed costs if not more than that
If we look at the price from the previous year, the difference in steer and heifers finishing price was around 20c/kg or about €60 on the average steer and €55 on the average heifer.
While there may be a case for farmers who finished stock they bred themselves, the case for farmers who purchased stock for finishing is very weak. The store price was back by at least the value of extra feed costs if not more than that. The main reason for the price collapse last autumn and winter and, as we see now, is the extra strong slaughter figures. We slaughtered about 50,000 more cattle over the winter than usual. With higher feed prices this was insanity. It is my opinion that most of this was driven by some farmers presuming the kill would drop because of higher feed prices.
Maybe we should call it the big boys fund as that seems to be where it is targeted
Store and weanling producers on the other hand who sold cattle back last fall had no control over their farming enterprise and had to accept their losses. My understanding is this fund is tailored as a fund for Brexit losses.
Maybe we should call it the big boys fund as that seems to be where it is targeted.
While all the talk is of preventing money going to processor-owned and controlled feedlots, there is another group that should not be compensated.
These are finishers who have contract prices to finish cattle. These farmers again knew their costs before they start to finish cattle.
There should be a limit of no more than €10,000 to any farmer
It is my opinion that the fund should be split in three parts equally to finishers, weanling producers and other drystock farmers. There should be a limit of no more than €10,000 to any farmer. It will be obscene if we see a few hundred farmers getting €20,000-€30,000 or more and tens of thousands who have all incurred losses over the last six to 10 months receive nothing.
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