Drop in farmgate prices expected

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DAERA economist Paul Caskie told delegates attending the recent Alltech Agribusiness briefing that farmgate prices will continue to decrease over the coming years. His perspective on this is that the farming industry must respond in a two-fold manner: increase productivity and improve efficiency levels.

All of this is fine and dandy, up to a point. But with increasing bureaucratic, environmental and administrative challenges continuing to impact on local agriculture, surely farmers must get paid a price that reflects all of the ensuing investment that will be required to ensure compliance, where these matters are concerned.

The reality is that we don’t do cheap food in this part of the world. Further evidence of the increasing bureaucratic pressure on farmers is the recent confirmation of increasing numbers of cattle being discarded at meat plants, because of issues relating to their identification. A recent survey confirmed that farmers get more vexed when it comes to securing compliance with animal identification and traceability measures, than would be the case with any other facet of their businesses.

It’s also worth pointing out that, had redmeat prices kept track with inflation over recent years, the producer price for beef now would be in the region of 520 pence per kilo deadweight.

This figure knocks for six the notion that food is expensive. In reality, all the staple food items are cheaper now, in real terms, than they were a generation ago. It’s also worth remembering that the amount of aid available to agriculture, courtesy of the Basic Payment, is reducing every year. And who knows what’s coming down the track, once London takes over the farm support reins post 2020.

All of this serves to highlight the need for our farming industry to get a strong and clear message across to consumers, highlighting the need for a proper and constructive debate on the way food is now produced. Farmers cannot be expected to work for nothing. And the reality is that a post-Brexit UK cannot expect to survive on the back of food imports.

There is a clear and strategic need for the maintenance of a strong indigenous farming industry in Northern Ireland. However, this will not be secured on the back of a cheap food policy. Production costs have doubled on many farms over the past five years. This development has not been reflected in the shops, which means that farmers are taking most of the pain. Retailers and consumers must, therefore, be reminded in the strongest possible terms that farmers can only take so much.