Beef Supplies 'At Risk' if Retailers Don't Pay More

UK - Alistair Darling and the Treasury may not like it, but the fact is that beef retail prices will have to rise substantially to ensure continuity of supply, according to Dan Buglass in The Scotsman.
calendar icon 26 February 2008
clock icon 1 minute read
Farmers are currently receiving almost 15 per cent more for finished cattle than 12 months ago, with top-quality animals now making about 250p per kg on the hook, but this is still not enough to maintain the required level of production. Meanwhile, the processing sector is being squeezed hard by the large retailers, to the extent that there is very little profit in handling prime cattle.

The supermarkets have been repeatedly warned that they must pay more – and charge more at the checkouts – so that every link in the chain can make a decent margin.

Currently, the multiples are making virtually no profit from selling beef. The trade view is that competition is so fierce that the big four chains are terrified of losing market share. But some-one will have to blink first – and soon.

Source: Scotsman
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