First person the beef crisis
We are ‘sitting on a ticking time bomb’, says Vincent Leavy
Vincent Leavy from Kinnegad, who has been farming since 1983, says the current situation in the beef sector is akin to sitting on a “ticking time bomb”.
“This goes back to June 2013 when the price of beef was €4 a kilo. At its peak it reached €4.75, and it has gradually gone downhill since. In June of this year we were getting €3.80. We had no choice, we had to take it, we tried to get them up to €3.85. That equates to €320 on average for dead weight, so it’s easy to work out, from €4.75 a kilo to €3.20 a kilo, that’s a loss of at least €280 a head,” explains Vincent.
The knock-on effect means a poor credit rating with the banks and now Vincent is unsure how long he can continue with farming.
“It’s been extremely difficult dealing with the banks. It means that our stocking loans are not being cleared, so this year we came into a stocking loan not being paid off, so it goes against you. So far they’ve operated on our history but they’re not always going to do that.
“It’s becoming too big a gamble. I have 260 cattle in sheds and I don’t know what I’m going to get for them. As it stands I’ll be operating at a loss,” he said.
“We would need to get €4 to break even. In the next two months, if the factory prices don’t change, the future looks very uncertain.
“It’s extremely worrying and extremely tense at the moment. It’s like sitting on a ticking time bomb, we have no control over the price, we’re price takers. It’s come to a crescendo. We want transparency from the factories, we want to see who’s getting what,” he insists.
“If we didn’t get our Single Farm Payment we’d be absolutely destroyed, and that price has also been sliding. We’ve been hit every way over the last couple of years. Even the REPS scheme, it used to be €10,000 for 100 acres, that figure has now halved, and the Single Farm Payments have reduced by 10 or 15% .
“It’s very hard to see how we can continue operating like this. I have two young sons and I will not encourage them to go into farming because you don’t know in two weeks’ time if you’ll have the money to pay the mortgage or the bills.
“Farmers have all the cost. When you’ve spent a lot on infrastructure, having everything right and in place, each animal gets one tonne of meal, and it’s €250 or €260 per tonne. It’s close to €100 per head of silage, that’s €370 straight away, and that’s not taking into consideration your transportation to the mart and factory, which is €30 per head, then there’s veterinary bills and vaccinations.
“The figures just don’t stack up. We want the figures to be transparent, from the day the animal is born, to the day the animal reaches the plate. The factories don’t tell us anything. In 1986 when we sold cattle, you could ring around five factories and get a difference of 5 pence, now it’s same price all the time.
“Something has to change. We need more transparency. Who is getting the money? Certainly not the farmer – who has the biggest cost of the whole lot.
“We have to have everything perfect to get Bord Bia approval, you have to continually spend money to have everything right and yet we don’t get paid for keeping things right. It’s very difficult to accept. Anybody with any kind of a job is better off because we can’t budget for anything.
“It has never been continually this bad. I always say in farming there is a five-year cycle, and that’s the same for pigs, dairy and beef, but this is the worst. If we had transparency, we could see where the biggest margin is being made. We can’t accept something we can’t see”, said Vincent.