Irish Consumers priced out of the market

evolving_doors

First off, I'm not a farmer. So I was looking for opinions from farmers here after watching the latest ETTG program on RTE... the usual story... 'Premium Irish product' in high demand in China.

So... if it gets to the stage for yergoodselves that it'll be more profitable to sell meet and dairy abroad then won't it price the ordinary consumer out of the market at home? A similar example would be The Quinoa Controversy.

Basically I was wondering if it will get to the stage where the ordinary beef and milk I buy in Ireland will become a 'premium product' at a premium price?

BTW I'm actually in favour of farm subsidies/CAP which provide us with an excellent product, I've travelled outside europe a bit and could never find decent quality meet/dairy at a good price the same as we get in Ireland (but alas don't appreciate!).

ganmo

One of the big differences between premium meat and non premium is the animal it comes off but there are also factors like the cut some cuts are top dollar and others are cheaper. So for meat there will always be non premium meat available

Milk...lord knows what's goin to happen but the supermarkets won't charge more than ppl are willing to spend.

Coonagh

ganmo wrote: »

One of the big differences between premium meat and non premium is the animal it comes off but there are also factors like the cut some cuts are top dollar and others are cheaper. So for meat there will always be non premium meat available

Milk...lord knows what's goin to happen but the supermarkets won't charge more than ppl are willing to spend.

And if the supermarkets push too hard on liquid milk the few remaining processors engaged in that business will leave it and dry the milk instead, liquid milk could then have to be imported from the north. I know this is hypothetical but I do see it as a possibility.

Coonagh

Armelodie wrote: »

First off, I'm not a farmer. So I was looking for opinions from farmers here after watching the latest ETTG program on RTE... the usual story... 'Premium Irish product' in high demand in China.

So... if it gets to the stage for yergoodselves that it'll be more profitable to sell meet and dairy abroad then won't it price the ordinary consumer out of the market at home? A similar example would be The Quinoa Controversy.

Basically I was wondering if it will get to the stage where the ordinary beef and milk I buy in Ireland will become a 'premium product' at a premium price?

BTW I'm actually in favour of farm subsidies/CAP which provide us with an excellent product, I've travelled outside europe a bit and could never find decent quality meet/dairy at a good price the same as we get in Ireland (but alas don't appreciate!).

At the minute when you are buying beef in Ireland you are getting an ultra premium product the problem is the irish consumer is not willing to pay a premium price. Look at what the Chinese are prepared to pay for a premium imported product, irish consumers have this at a discounted price due to the CAP and the pressure exerted on primary producers by the processors and the retailers. Western consumers want more and pay less.

kowtow

Coonagh wrote: »

Western consumers want more and pay less.

The situation is confused further, in Europe, of course by the fact that these same consumers are already paying extra - by funding the CAP.

The tragedy of all subsidies like CAP is that they tend to accumulate value in the hands of everybody but those for whom they are intended.

European consumers are therefore subsidising an entire generation of landowners (via inflated land prices), factories & processors (who are able to push prices down until they absorb the SFP from producers) not to mention a raft of ancillary industries from Health & Safety to Govt. agriculture departments.

They are paying for a premium product one way or another, it's just that the money they are paying isn't ending up in the pocket of the guy piking the silage up.

Farmer Pudsey

OP Dietry choice in general is down to the individual. In reality Western consumers spend a lower percentage of there income on food that other poorer economies. What is the average family spend on Food. More is often spend/ month on a car or on luxury goods. We will not even look at the spend on smoking or alcohol. This year we changed health insurance providers and we moved it to a Direct Debit from a Bank account in my better half name. It amounted to around 250/month. It really makes you focus on if you really need it.

Food cost is the least of our costs and we could trim that easier than most other costs.

frazzledhome

Coonagh wrote: »

And if the supermarkets push too hard on liquid milk the few remaining processors engaged in that business will leave it and dry the milk instead, liquid milk could then have to be imported from the north. I know this is hypothetical but I do see it as a possibility.

I'd that not almost the case already. Northern milk and only 1 seriously scaled liquid milk operation in the south?

Milked out

frazzledhome wrote: »

I'd that not almost the case already. Northern milk and only 1 seriously scaled liquid milk operation in the south?

Are glanbia making much out of their liquid milk?

Coonagh

frazzledhome wrote: »

I'd that not almost the case already. Northern milk and only 1 seriously scaled liquid milk operation in the south?

That's why I reckon it wouldn't take much for them to leave the standard liquid market and concentrate on value added mooju, super milk etc....,

frazzledhome

Milked out wrote: »

Are glanbia making much out of their liquid milk?

For the first time in a while, yes but it's down to reduced farmer margin rrduced staff and add on consumer products.

It's no gravy train but their clawing back mkt share.

Farmer Pudsey

frazzledhome wrote: »

For the first time in a while, yes but it's down to reduced farmer margin rrduced staff and add on consumer products.

It's no gravy train but their clawing back mkt share.

Did Kerry not sell them there liquid milk business.

frazzledhome

Coonagh wrote: »

That's why I reckon it wouldn't take much for them to leave the standard liquid market and concentrate on value added mooju, super milk etc....,

Those fortified milks are going a bomb. The UHT is where they could head as they develop mkts. That milk can be produced at any time of the year further phucking the farmer.

I think anyone considering producing winter milk without a contract and bonus needs their heads examined. All that'll be achieved is cheap milk for processor and undoing the bonus structure that's already in place

Base price

OP the majority of beef we consume and sold in butchers/supermarkets in Ireland is heifer beef. Mostly traditional breeds or x bred with Continental breeds.
To be honest I doubt that any beef processor/factory/abattoir will dump on their own door step and neglect their home market.
I did not see the ETTG programme but the one thing that you need to realise is that we farmers do not didactic prices - the factories/processors do.

frazzledhome

Base price wrote: »

OP the majority of beef we consume and sold in butchers/supermarkets in Ireland is heifer beef. Mostly traditional breeds or x bred with Continental breeds.
To be honest I doubt that any beef processor/factory/abattoir will dump on their own door step and neglect their home market.
I did not see the ETTG programme but the one thing that you need to realise is that we farmers do not didactic prices - the factories/processors do.

The market dictates the price to the consumer not the processors. The processors are price takers but they can pass it on which the farmer can't

enricoh

I know a lad well up in glanbia n he was telling me flogging liquid milk in Ireland makes peanuts for them n baby milk is where the dough is.
Didn't see ettg but beef n milk are a quality product here, always taste crap when i,m abroad! a 500ml bottle of water twice the price of the same of milk is sinful

Base price

frazzledhome wrote: »

The market dictates the price to the consumer not the processors. The processors are price takers but they can pass it on which the farmer can't

Jeez that sounds like the same crap that Rangler1 goes on about.

ganmo

frazzledhome wrote: »

The market dictates the price to the consumer not the processors. The processors are price takers but they can pass it on which the farmer can't

yes the market dictates but who influences the market?
farmer - by increasing production reduces price
processor - invest in marketing/branding or producing a commodity
buyer...paying for quality? OP is wondering what will happen when everything is quality? bit like farmers concerns about bord bia bonus once everyone is assured

frazzledhome

Base price wrote: »

Jeez that sounds like the same crap that Rangler1 goes on about.

Do you think for one minute the processors tell Tesco what to charge for beef?

ganmo

enricoh wrote: »

I know a lad well up in glanbia n he was telling me flogging liquid milk in Ireland makes peanuts for them n baby milk is where the dough is.
Didn't see ettg but beef n milk are a quality product here, always taste crap when i,m abroad! a 500ml bottle of water twice the price of the same of milk is sinful

then why do they spend so much advertising it?
when was the last time ya saw a milk ad that wasn't glanbia?

frazzledhome

ganmo wrote: »

then why do they spend so much advertising it?
when was the last time ya saw a milk ad that wasn't glanbia?

Tbf they are the only ones advertising and its beginning to reap rewards. Aldi are the only other milk ads I see

Farmer Pudsey

frazzledhome wrote: »

Tbf they are the only ones advertising and its beginning to reap rewards. Aldi are the only other milk ads I see

As far as I know Kerry sold there liquid milk business to Glanbia. This would be the DAWN and Golden vale brands. I may be wrong but as far as I know the liquid milk suppliers did not move. This leaves Glanbia with the biggest market share in LM.

Chloris

Do you need to advertise milk? I just get whatever, it's all basically the same taste. Except foreign milk, God that tastes like gawk.

In fact, shopping abroad in general is a nightmare. It's really hard to find a supermarket in a lot of European cities. If that's not an issue, the meat is priced at around twice what it is here, and the quality is cat. I'm extremely happy with the cost of meat we're getting.

Base price

frazzledhome wrote: »

Do you think for one minute the processors tell Tesco what to charge for beef?

Realistically NO, but we all know via the media how Tesco treats their suppliers be it meat or veg :mad:
Again I will iterate - same crap

Coonagh

Chloris wrote: »

Do you need to advertise milk? I just get whatever, it's all basically the same taste. Except foreign milk, God that tastes like gawk.

In fact, shopping abroad in general is a nightmare. It's really hard to find a supermarket in a lot of European cities. If that's not an issue, the meat is priced at around twice what it is here, and the quality is cat. I'm extremely happy with the cost of meat we're getting.

You should be happy with the price your buying it for less than it costs to produce it.

kowtow

Chloris wrote: »

Except foreign milk, God that tastes like gawk.

Especially if it has been homogenised, turned into milk powder, and then re-constituted in one form or another for export.

Even if it was originally "grass fed"

Hmm.

mahoney_j

frazzledhome wrote: »

Tbf they are the only ones advertising and its beginning to reap rewards. Aldi are the only other milk ads I see

And that's prime Arrabawn milk

joejobrien

Farmer Pudsey wrote: »

As far as I know Kerry sold there liquid milk business to Glanbia. This would be the DAWN and Golden vale brands. I may be wrong but as far as I know the liquid milk suppliers did not move. This leaves Glanbia with the biggest market share in LM.

Yes you are right. Kerry got out of that busineess completely. The l. suppliers didnt move . they were given a number of years guarteening milk supply but had to be notified something along the lines of 3years in advance if Glanbia
wer not longer going to renew there contracts.

rangler1

Base price wrote: »

Jeez that sounds like the same crap that Rangler1 goes on about.

Crap it might be, but that's what it's like in the real world.
I think you need a reality check, the problems last spring were being flagged for some time.

whelan2

kowtow wrote: »

Especially if it has been homogenised, turned into milk powder, and then re-constituted in one form or another for export.

Even if it was originally "grass fed"

Hmm.

first thing on holidays used to be looking for real milk to put in babys bottle, loads of uht crap. Love a cup of tea as soon as i get back from holidays , never tastes the same anywhere else.

whelan2

Chloris wrote: »

Do you need to advertise milk? I just get whatever, it's all basically the same taste..

theres full fat milk, low fat milk, super milk, slimline milk.........theres a hell of a difference in taste between full fat milk and slimline milk

kowtow

whelan2 wrote: »

first thing on holidays used to be looking for real milk to put in babys bottle, loads of uht crap. Love a cup of tea as soon as i get back from holidays , never tastes the same anywhere else.

We lived off the coast of Africa for a few years - could only get UHT / powder milk (apparently grass is not cyclone proof !?!) - and as far as I remember we stopped drinking tea altogether, never minded UHT in coffee. The children more or less forgot what milk looked like let alone tasted like.

Moved directly from there to the swiss mountains where they used to get milk from the churn at the creamery on the way to school. Must have been a bit of a shock to the system.

evolving_doors

OP here again, just to get back to the original question... Whats the chances of China demand pushing up prices at home.

Also would the demand and rush to cash in change the nature of farming (moving from small family farms to factory farms owned by processors/corporations!).

onyerbikepat

I was in a factory in China a few years back. It was a brand new factory owned by a foreign multinational. I passed through the canteen as the young staff, all newly recruited, were having lunch. It was rice and fish heads all round. I was told it was propably the only meal most of them would have that day.
So maybe it should be re-phrased to 'The privileged in China demand premium Irsh food products'.

kowtow

Armelodie wrote: »

OP here again, just to get back to the original question... Whats the chances of China demand pushing up prices at home.

Also would the demand and rush to cash in change the nature of farming (moving from small family farms to factory farms owned by processors/corporations!).

1. Demand from China (for bulk powder milk at least) unlikely to push up prices at home except to the extent that a grass based spring calving mantra (to feed the manufacturing / export) market might make liquid milk such a rarity that we rely on imports.

2. If we do follow the "cheap milk / from grazed grass" mantra to serve export markets it is a virtual inevitability that family farms as we know them will vanish - there is only one means of expansion on grazed grass and that is across the hedge into your neighbours place (removing the hedge as you go).

On the other hand, Irish farmers seem to be generous when selling their products but greedy when selling their land, so the notion that we really can expand cheap production from grazed grass seems a little far fetched unless your neighbour is prepared to give away land for nothing.

The reality will be a kludge between (a) farmers expanding on grazed grass only , but carrying dangerous debt & interest burdens as they have to pay up for land and (b) more intensive producers relying partially on bought in feed taking their chances in the profit / loss cycle of good and bad years.

Either method will have it's winners, and it's losers.

Mad4simmental

Don't forget that we are not the only country knocking on China's door to.

If China hit a big economic crash (that they are due) it may well stirr the pot to.

I hope they do brake into the market in a big way as this would have a good knock on affect for many people.

atlantic mist

i do think we hav a premium product in meat and milk, but consumers here consider our product to be the standard not the premium(i would myself) product,
when you are out foreign u realise how poor the dairy/meat products are, i find it annoying we compare our prices to that internationally because we export a superior product, we just never scientifically marketed it as a premium product
too much emphasis in media placed on china, there is opportunities there but nz n oz will command that market wit their low cost systems unless they have a few more safety scares,
we shouldnt compete wit them as were not factory farms hope we dont go that way but who nos, we need to be looking in the high end markets globally
here supermarkets use power to keep low cost model in place lack of consolidation in processing/selling gives them buying power can only see rises there if supermarket increase their required margin or below cost sellin ban intro by eu. consumer now used to low prices for food, processed foods so cheap as subsitiute cant c domestic prices rise much.
it should always b cheaper for home made product to b cheaper in country of origin and more expensive for export

hfallada

onyerbikepat wrote: »

I was in a factory in China a few years back. It was a brand new factory owned by a foreign multinational. I passed through the canteen as the young staff, all newly recruited, were having lunch. It was rice and fish heads all round. I was told it was propably the only meal most of them would have that day.
So maybe it should be re-phrased to 'The privileged in China demand premium Irsh food products'.

But there is 1.3Billion Chinese. If only 10% of them get rich. That is still 130 Million consumers willing to buy Irish goods. That nearly 25% of the entire population of the EU. If 25% of Chinese can afford Irish goods. Then its a massive market in years to come.

I seen a German news report, showing German firms expecting milk to China. Since most containers are bringing goods to Europe, instead of bringing goods to China. Containers to China are super cheap. The Germans are sending carton milk to China for only 7 cent a litre. The same news report discussed what if China pushed prices for German consumer. Most consumer agreed that they were willing to buy milk until it was €1.20-1.50 a litre. But I cant see Irish willing to pay that much for milk.

keep going

Armelodie wrote: »

First off, I'm not a farmer. So I was looking for opinions from farmers here after watching the latest ETTG program on RTE... the usual story... 'Premium Irish product' in high demand in China.

So... if it gets to the stage for yergoodselves that it'll be more profitable to sell meet and dairy abroad then won't it price the ordinary consumer out of the market at home? A similar example would be The Quinoa Controversy.

Basically I was wondering if it will get to the stage where the ordinary beef and milk I buy in Ireland will become a 'premium product' at a premium price?

BTW I'm actually in favour of farm subsidies/CAP which provide us with an excellent product, I've travelled outside europe a bit and could never find decent quality meet/dairy at a good price the same as we get in Ireland (but alas don't appreciate!).

Wouldnt be one bit worried about it.this is just fg ramping things up an election putting out a few positive spins.realistic ly all we hope to get is nice steady increase to chine over the years but at the wages out there I cant see the irish consumer being out priced and for all prople in china you probaly still wouldnt have the same population as europe with similar spending power