Paul Finnerty, group chief executive, ABP Food Group Unlimited, Ardee, Co Louth

DEAR SIR:

Last week’s editorial made the extraordinary inference that ABP has a strategy that somehow sets out to influence cattle price in one jurisdiction to soften the market for subsequent M&A activity. This is untrue and it is very disappointing that the Irish Farmers Journal would print such an assertion with no effort made to contact our business for comment or contribution.

ADVERTISEMENT

Also incorrect is the claim that our business controls over 40% of the UK retail beef market – an estimate that is materially overstated.

The editorial, which refers to ABP six times, failed to mention that there are four other beef processors with operations in both the UK and Ireland. It also gives the impression that lower-cost Irish cattle prices are used to “offset” higher British prices. This is simply not the case as clarified to a recent Beef Forum meeting by a leading UK retailer.

The editorial also focuses on live exports and it is important to state that ABP has always worked in an industry where live exports have been a feature. Live exports are a factor of market requirements in the importing country. We have no influence whatsoever on the destination of live exports to any country and are not involved in the live export business.

The Food Harvest cattle price targets for the year 2020 were surpassed in 2013 and the Irish industry currently returns 104% of the average European price. This year has been difficult for the sector with prime cattle prices down 10-12% in Ireland in the past twelve months as a result of a 10% increase in supply into a weak consumer market. Putting this in context, milk is down over 20% (and falling), many cereals are down over 20% and oil is down over 40%. In the UK, prime cattle prices are down 7-9%.

The much-discussed difference in beef prices between Ireland and the UK has arisen because of a deficit in British supplies coupled with consumer preferences for home-produced product. This has resulted in a current disconnect between UK and European prices. This matter is currently being independently addressed at the Beef Forum through Bord Bia.

The long-term outlook for Irish beef is positive and we are confident that the Forum will deliver a creditable and sustainable outcome for all stakeholders within our industry. ABP is committed to this process as we seek to grow our business in Ireland and abroad while also increasingly competing against the major global players.