Concessions by the beef processing industry on the weight of animals, price incentives, and contract use will inevitably provide higher prices for farmers. The outcome may not have satisfied many of those who blockaded meat plants twice in recent weeks but, because direct price negotiations are banned under competition and consumer protection legislation, it was as much as they could have expected. A tightening in supplies; the establishment of producer organisations and an opening of new markets are likely to provide necessary, longer-term support.
Complaints that factories changed specifications on weight and age to depress the price of cattle provided the original fuel for the dispute. Growing price differentials between here and the UK compounded grievances. While the meat plants insisted the specifications always existed, they have agreed to suspend penalties for heavy animals until the end of this year and to work to an agreement with retailers on raising the age specification. Price incentives for quality-assured cattle will apply from January.
Distrust between farmers and beef processors has been as intense as that which, on occasion, erupts between farmers and supermarkets. More transparency and the development of an official pricing index for cattle may help dispel some misconceptions in the short term, while the establishment of producer organisations to negotiate on behalf of groups of farmers will strengthen their position. More, however, needs to be done in terms of cooperation.
An official report on the future of the industry emphasised the need for greater coordination by state bodies that advise farmers to ensure coherence in policy and practices. Factories were encouraged to provide early warnings on market changes and their needs. Recognition of over-wintering costs would prevent a retreat to seasonal supply patterns. Farmers have had a number of torrid years because of additional feeding costs and depressed prices. But the potential of the industry, based on grass-fed animals, remains impressive.