FOR the first time cattle prices have topped 400 cents per kilogram mark at the Central Tablelands Livestock Exchange and while it is good news for farmers it is putting pressure on Orange butchers.
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Butcher shops are closing across Sydney as a result of the rapid increases in wholesale meat prices and a couple of stores have also been put up for sale in Dubbo.
Although no Orange butcher shops have closed, M & J’s Butchery owner manager Michael Borg and Farmgate Butchery owner Greg Pearce said prices are rising too fast and too high to pass on to customers so businesses are bearing the brunt of the rises while still having to pay rent, insurance and high electricity costs.
Mr Borg has been working in the industry for about 35 years and said this is the worst he’s seen in the industry and it will be another 18 months to two years before it gets better.
He said more people are turning now to chicken but even it has increased from $9.50 per kg to $11.50 per kg in one week and due to purchase changes average sales have gone from $60 to $42 in the past six months.
Mr Pearce said in the past 18 months wholesale prices rose by 50 per cent, too much to pass on to customers.
Mince, which previously sold for $8.99 per kilogram now sells for $13.99 per kg, but he said it would be closer to $18.99 per kg if he passed on the full increase to customers.
Although some customers balk at paying more than $30 per kg for scotch fillet steak he pays $25 per kg wholesale and needs to pay wages, rent and bills from the $10 difference and he’s making a $4 per kg loss on bones, which would cost $7 per kg if he passed on the increase.
“We’ve got to pay much, much more for our beef but the customer won’t pay, everyone is struggling for a dollar so to put the price up 50 per cent won’t work,” Mr Pearce said.
“The high prices, they are a real struggle, everyday we seem to get more information that prices are up again and when we talk to other butchers every single one of them are struggling.”
He said the rapid pace of the price increases had the biggest impact.
“Farmers deserve to get more money for their product, we’ve just got to catch up I guess with the process,” Mr Pearce said.
Both butchers attributed the prices to low stock numbers, rainfall reducing the number of animals brought to market and high export rates brought about by a low Australian dollar and free trade agreements.
Mr Borg said as a result of low stock numbers even abattoirs have reduced production with one he deals with losing $200 per animal.
“They didn’t do anything this week, they didn’t kill anything,” he said.
