Mr. Philip Carroll:

I thank the Chair and committee members for the opportunity to speak today about processing throughput and cattle prices in the beef industry. I am the chairman of Meat Industry Ireland, MII. I am joined today by Mr. Dale Crammond, director and by Síle Sweeney, senior executive. MII members operate 28 processing sites nationwide, directly employ more than 12,000 people and support many thousands more jobs across the rural economy.

At the outset it is important to recognise the vital role farmers play in supplying the high-quality raw material that underpins our international success. They deserve to be fully rewarded for that contribution and this was reflected in the historically strong cattle prices seen in recent years, especially in 2025. The falling cattle prices in the early part of this year is a disappointment to the sector, and to farmers in particular, following a period of strong growth. Our members are acutely aware of the challenges this creates at a time when the food and drink sectors face multiple geopolitical economic pressures. We have engaged with the sector to share our perspective and will continue with that dialogue.

The Irish beef sector is export-led with 90% of production sold in international markets. Last year, exports exceeded €3.5 billion, up 23% on 2024 even though volumes were 40,000 tonnes below the average of the past decade. This increase was driven by short-term inflationary market conditions. In the UK market, exports rose in value by 25% to €1.6 billion, representing 40% of total market value despite a decline in UK beef imports. As retail prices continued to rise during 2025 it became evident that demand was being affected with volumes down 7.2% towards the end of the year. High prices effectively stalled beef demand across retail and food services. Meanwhile, imported beef from Australia, New Zealand, Poland and Brazil gained market share. Exports to EU markets rose by 28%, generating a further €1.6 billion in 2025. Demand was strongest for forequarter mince and manufacturing beef, while higher-value primal cuts declined as the price gap between beef and other meats such as pork and poultry became more evident. Exports to other international markets fell to €135 million as buyers focused on sourcing closer to home. This reflected a widening gap on price between Ireland and the EU compared with international suppliers.

These export trends underlined an important point that any discussion of domestic cattle prices or kill numbers must be grounded in global market conditions, consumer purchasing power and structural change within the national herd. Last year cattle throughput fell by over 200,000 head. According to the latest Department of agriculture and Central Statistics Office, CSO, figures the beef kill in the first quarter of 2026 was some 72,000 head lower than in the same period in 2025. That is a contraction of 18.7%. The main factors driving the current supply-side vacuum are the lag effects of live exports and nitrates constraints. In 2023 and 2024 Ireland saw record live cattle and weanling exports exceeding 300,000 head annually. Those animals are now being processed in the Netherlands, Spain and Italy rather than in Irish plants. Dairy bred animals now account for over 60% of the total beef kill. However, the nitrates derogation and implementation of dairy banding have forced many farmers to reduce stock numbers or exit beef finishing entirely in order to remain compliant with nitrates. Alongside the decline of the suckler herd this has effectively placed a hard cap on cattle availability in 2026. We are conscious that winter finishing challenges were more acute this year when finishers were caught in a market correction that moved faster and further than anybody in the supply chain could have anticipated, including processors. Farmers made decisions in the autumn based on market signals that looked reasonable at the time. High input costs, with concentrate feed still 25% above the five-year average, discouraged many producers from winter finishing.

Without price certainty to cover meal and energy costs, the spring supply gap coincided with weaker demand in the UK and the EU, putting further pressure on price.

Irish cattle prices reached historic highs in 2025, driven by genuine supply tightness and strong international retailer demand. The resulting price increases affected demand and made Europe and the UK targets for third-country imports. Competitiveness in our primary markets is now under severe threat from a perfect storm of international factors. The UK market has shifted. Historically, Ireland provided nearly 80% of UK beef imports. Following the UK-Australia and UK-New Zealand free trade agreements, and growth in Polish and Brazilian imports, Ireland's market share fell to 67% in 2025. Australian beef imports into the UK have surged by over 400%, offering a significantly lower-cost alternative to Irish grass-fed beef. There is little scope for us to price ourselves out of this market, nor can we diversify to greener fields where none exist. As a result, our industry is facing a carcase imbalance driven by consumer behaviour. The latest Kantar figures from April show we are experiencing a volume decline in beef steaks and joints by 37% and 70%, respectively, as consumers trade down to cheaper proteins, such as poultry, pork or lower-value manufacturing beef. When prime cuts, which account for 30% of the animal, fail to achieve a premium price, the value of the whole carcase falls. In this market, processors are price-takers competing against lower-cost international suppliers.

Beef processing is a high-volume, low-margin business. When throughput drops by 19%, fixed costs per unit, including labour, energy, refrigeration, transport and regulatory compliance, increase sharply. Running a plant at 80% capacity is significantly less efficient than running at 100%. Despite these pressures, the prime Irish composite beef price closely tracks the export benchmark price. This demonstrates that Irish cattle prices are on a par with our European competitors despite the additional cost of exporting 90% of our beef output.

The 2025-26 cattle supply reduction is a structural reality rooted in dairy sector changes and previous export trends. Cattle prices, while lower than last year's historic anomalies, remain high by long-term standards but are under intense pressure from shifts in consumer spending and aggressive new trade competition. MII remains committed to the long-term viability of Irish beef farming. We recognise the value of farmers' work and the pressure they face when market prices fall and costs remain high. The beef sector is not unique in this regard. Similar challenges have recently affected the dairy and tillage sectors. The strong returns paid to farmers in recent years reflect the sector's dependence on their continued commitment. We aim to remain competitive within the UK and EU markets. We must continue working together to ensure the Irish beef brand remains both premium and competitive in an increasingly crowded global market. I thank the committee. We are happy to take any questions.