In a room in Agriculture House in Kildare Street, Dublin, on Saturday the two sides who had agreed to hold peace talks sat in silence at a long table as they were photographed and filmed before attempting to find a solution to the beef blockade.

The eight-man Irish Meat Association group sat with its back towards the Shelbourne Hotel. The four IFA men sat with their backs towards the National Museum.

At the top of the table sat the Minister for Agriculture, Mr Walsh, with his advisers. Not once during the five minutes while the cameras clicked did the two sides even look at each other. It was as chilly as a beef factory cold-room. One could almost feel the mistrust in the room.

Joe Walsh must have known it, too. When the media left, he addressed both sides, appealing for common sense.

The Irish Meat Association chairman, Mr Tom McAndrew, read a prepared statement outlining his organisation's stance.

In return for lifting the blockades, he would recommend that his members would remove the £1.80p increase in the veterinary levy which had caused the dispute, but, he said, market forces would determine the price of cattle.

The Irish Farmers' Association president, Mr Tom Parlon, outlined his organisation's stand.

He wanted the removal of the entire £5.50p veterinary inspection levy and a basic of 90p a lb. for his members' cattle.

The Minister then did what is known in the mediation business as a "George Mitchell" and the rest of the negotiations over the night were proximity talks, i.e. with the two sides in different rooms.

Just before midnight the talks broke up, with Mr Walsh reporting that they had been "very worthwhile" and that some progress had been made towards restoring a better working relationship.

The Irish Meat Association acknowledged that "some progress" had been made, but the IFA said the major issue of price had yet to be resolved and it wanted the factories to put a price increase offer on the table when the talks resumed yesterday evening.

The speed with which the dispute occurred and deepened took nearly everyone by surprise.

It had its roots in a meeting of angry cattle-producers in Portlaoise 10 days ago. They were demanding higher prices for their product.

Teagasc experts, they said, had established that farmers feeding cattle over the winter months, the so-called "finishers", needed 90p a lb. to survive.

They also pointed to the fact that producers in the Republic were receiving only 80 per cent of the average European price.

They were expecting an increase when the factories resumed work in the new year but instead, this day last week, they found themselves being paid 82p/84p a lb and the factories had passed on all of the veterinary levy increase. Until then they had been paying £3.70p.

The Minister for Agriculture had demanded that the meat inspection fees due to his Department be paid in full by the industry from January 1st and the taxpayer should not continue to subsidise the £8 million difference between what was collected at the plants and the actual costs.

For their part, the factories have argued that it has become increasingly difficult to sell beef abroad since the start of the BSE crisis of March 1996 because, following some recovery of the market, the lucrative EU markets have nationalised, i.e. meat is now identified by country of origin and most people like to eat their own national product.

They point to other problems in the market, such as the collapse of the Russian economy, which created major problems here, and the fact that they must buy as cheaply as they can at home to sell as competitively as possible abroad.

Whatever the merit of this, the beef-processing industry has had its best autumn ever. In that period nearly one million animals were processed at an estimated profit of £50 an animal.

The industry has had its best year on record, with nearly two million animals processed. There was little use of EU intervention, which kicks in to prevent a total price collapse.

Producers, on the other hand, were able to live with the prices paid by the factories until the end of the year because they had a relatively good summer and a good harvest.

Farmers were able to produce beef off grass at much less cost until the last five weeks of the year. However, there was a growing anger that they were not sharing in the good fortune of the factories, and the expectation of a price increase in the new year had kept a lid on their anger.

The IFA response to the court order preventing it picketing and fining it £100,000 a day for each day the blockade continues in defiance of the court order has been interesting.

The IFA had not expected the factories to seek injunctions so quickly, but it reacted traditionally.

It is, after all, made up of individuals who run independent operations separate from normal, organised society, pay little tax com pared to other citizens and believe the courts are "for criminals".

Mr Parlon described his members as "law-abiding" but conceded that they were sorry to have to step outside the law in order to continue their protest until a full hearing of the High Court case today, because "we have right on our side".

With an annual income of £5 million a year and assets believed to be in the region of just over £1 million, the IFA is prepared to take a short-term hit, not because it wants to but because its members are demanding it.

Ironically, an estimated £500,000 in membership levies is collected by the meat plants for the IFA, ICMSA and Macra na Feirme on every animal slaughtered.

The factories, on the other hand, are now into a loss-making situation.

They stand to lose valuable contracts to producers from other EU countries and, as of now, cannot even process the cattle they produce themselves.

It is estimated that the factories, including Larry Goodman's AIBP, Dawn Meats and Liffey Meats, produce enough cattle between them to keep the factories in production for about 20 days.

While the IFA will be forced to remove its pickets following today's High Court action, it is already working on a plan to boycott the meat plants and deny them the supplies they require.

For the 100,000 or so beef-producers it is a last stand. For the factories it is a point of principle. And for the 3,500 workers who are currently laid off it looks like more light wage packets ahead.