ICSA Beef chair Sean Sherman has said the continued collapse in factory quotes defies all logic when Ireland is experiencing the sharpest fall in beef production anywhere in Europe. "Factory quotes have fallen by 80c/kg or more since January and many finishers are now facing significant losses on cattle bought last autumn. What farmers cannot understand is how prices can be falling so sharply when everyone agrees there are fewer cattle available," he said.

Mr Sherman was commenting on RaboResearch's latest Global Beef Quarterly which showed that as beef supplies across Europe continue to tighten Irish beef production recorded the sharpest decline in the EU, down 14% on last year.

 Continuing Mr Sherman said, "At a recent Food Vision 2030 review meeting, Teagasc highlighted declining beef production and stressed that profitability will be critical if Ireland is to maintain its suckler herd and future beef output. At the same time, Meat Industry Ireland has acknowledged that cattle throughput is down almost 19% this year.

 Farmers have been saying for months that supply is tightening. Now Teagasc, industry analysts and the processors themselves are all saying exactly the same thing. The question farmers are asking is very simple: if there are fewer cattle available, why are factories continuing to cut prices week after week?"

 Mr Sherman said many winter finishers bought store cattle last autumn based on market signals which pointed towards strong demand and continued tight supplies. "Farmers paid exceptional money for stores because every signal coming from the market suggested supplies would remain tight and prices would remain strong. Those same farmers are now being asked to absorb massive losses despite the fact that cattle numbers have fallen exactly as forecast."

 "Processors themselves have acknowledged that farmers made reasonable decisions based on the information available at the time. If that is the case, then farmers are entitled to know what has changed so dramatically that cattle worth over €7/kg at the start of the year are now being quoted at little more than €6/kg. The reality is if prices continue to be eroded at a time when cattle supplies are becoming increasingly scarce, more farmers will simply walk away from finishing cattle."

 Concluding, Mr Sherman said, "Farmers are not asking for special treatment. They are simply asking for an explanation. Teagasc, market analysts and the processors themselves all agree that cattle supplies are tightening. Meat Industry Ireland acknowledged as much before the Oireachtas Committee last week. Yet factory prices continue to move in the opposite direction. Processors have had every opportunity to explain that contradiction, but farmers are still waiting for a convincing answer."