National Beef Association Show Concern Over Pricing Inequality

UK - The National Beef Association (NBA) has welcomed Tesco’s announcement of ex-farm price contracts for approved finishers but warns against unfair premiums.
calendar icon 16 November 2012
clock icon 2 minute read

Premiums of up to 40p have been welcomed for the the delivery of certified, in-specification, high provenance stock including Aberdeen Angus.

The NBA has queried how bonus payments for top ranking cattle types will be constructed - and exactly how much income individual finishers across the UK can receive for supplying such animals.

“We are pleased Tesco has set about building supply structures to capture more of the high provenance beef that an increasingly high proportion of consumers are ready to buy at top retail prices,” explained the NBA’s Northern Ireland chairman, Oisin Murnion.

“But questions are already being raised about the base price the bonus will be built on and early indications are that actual realisation prices for contracted suppliers may vary widely at a cross-UK level.”

British feeders supplying certified Aberdeen Angus steers and heifers can expect payments to be calculated around an R4L base of 390p and that the R4L base in Scotland for most Angus cattle is 380p-384p. Concerns in Northern Ireland are growingas typical 0=3 classification Angus cattle receive a bonus of just 18p so feeders supplying 280kg-380kg carcases expect less than 340p in net terms.

This is a lift of just 18p if NI’s all-cattle bonus for supplying assured, in-spec, stock is also included. “Finishers in the Province are seriously worried that they will not be treated equally with other native breed, feeders elsewhere in the UK and that the current 44p, £160 a head, deadweight discount on our commercial cattle compared with the GB average will feature in our Angus bonus calculation too," warned Mr Murnion.

“If this proves to be the case it would be a disappointment. Farmers in Northern Ireland are especially anxious that they continue to suffer as a result of the inexplicable price discount that already exist between their cattle and similar animals produced by fellow farmers in other parts of the UK.”

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