Beef farmers "may face" 40% drop in income

THE BSE crisis could cost Irish beef farmers a 40 per cent drop in incomes this year in a "worst case scenario", according to the Irish Farmers' Association.

This would happen if beef prices fell to the "safety net" intervention level at which the European Commission would be obliged to buy stocks and if there is no increase in compensation from the Commission.

If prices are kept at current levels - about 90p per lb, or 10p above the intervention level - the IFA estimates that income for beef farmers could still fall by 30 per cent. This takes into account the EU's £57 million compensation package.

The figures were presented in Dublin yesterday by the association's chief economist, Mr Con Lucey, who warned that the beef losses could mean an overall drop in farm income this year of 10 to 12 per cent.

The IFA president, Mr John Donnelly, said the figures showed that the EU compensation package was not adequate to cover the level of real losses. "The £57 million currently on the table is far short of what is needed and I will be continuing to insist that the Minister pursues full compensation at the crucial Council of Ministers' meeting in two weeks time", he said.

Beef farmers' income in the first quarter of this year was affected by cuts in export refunds last November and to a lesser degree by the first BSE scare last autumn. Adjusting the figures to account for this, the IFA calculates that 1996 losses directly attributed to the current BSE crisis will be between £153 million and £201 million.

The biggest losers among the beef farmers are the "winter finishers", who buy in the autumn and slaughter in spring. According to IFA figures, these are facing BSE related losses of £137 a head on factory steers.

Even without the beef losses, farm income will fall about 5 per cent in 1996, the association predicts. This is explained by an estimated £50 million fall in milk prices and by higher costs. Income from pigs and sheep is expected to rise.

. The Fianna Fail spokesman on agriculture, Mr Brian Cowen, has criticised "the waste of Garda resources at a critical time" on patrolling the Border against BSE.

He said the Garda estimate of the operation's cost was an annual £20 million, compared with the £10 to £14 million he said it would cost to provide a computer system allowing the complete traceability of all cattle.

"Operation Matador is a fire brigade response where a long term solution is needed", he said. "That long term solution is available but unfortunately is being ignored by Ivan Yates and the Government."