NBA calls for transparent sales commission system
08/03/05

If the most influential deadweight cattle buyers do not react sensibly to calls to reduce dressing specification confusion and drop unjustified post-slaughter deductions they will force even more finishers into the auction system, the National Beef Association warned today.

"The move back to auction markets is already underway. The main reason is obvious price competition for the animals presented and a transparent sales commission system," explained NBA chief executive, Robert Forster.

"This contrasts with the current deadweight situation in which the biggest abattoirs use an unapproved dressing spec which gives inspectors no chance to monitor the amount of tissue removed before the carcase is weighed for payment and then can add extra handling charges which in some instances are the equivalent of 2p-4p a deadweight kilo."

"Many small and medium sized abattoirs are fair to their customers and use officially approved specifications but if the attitudes evident at the larger end of the slaughter spectrum persist many companies will find themselves having to secure their throughput by paying unwelcome sums in auction commission and haulage charges as well as losing the income they gain from their in-house deductions too."

According to the NBA the popularity of the auction system is accelerating. Back in spring 2002 only 3,750 slaughter cattle a week were sold under the hammer in England and Wales and just 953 in Scotland."

"By the end of February last year weekly throughputs in England and Wales had climbed to 6,576 cattle and Scotland had moved to 1,026 head," said Mr Forster.

"And two weeks ago the MLC confirmed that English and Welsh total had jumped to 8,306 while Scotland had hit 1,305 head. This means that 9,611 finished animals were sold on the hoof compared with 19,824 on the hook and the auction contribution is 33 per cent of the total."

"The direction of the trend is obvious. Now that more buyers are at the ringside and the benefits of price competition have been made clear through the recent strengthening of the market an even greater percentage can be expected when prices begin to move up again at the end of the month."

"The bigger abattoirs have a clear choice. They can compete with the ever strengthening auction system on the basis of price and price transparency or they continue as they are and drive even more finishers back into the ring," he added."