Meat factories and beef farmers were given a series of warnings yesterday that their disputes over cattle prices could cause serious long-term damage to the industry as a whole.
The first warning came from the Minister for Agriculture and Food, Mr Walsh, who was equally critical of both the farmers and the factories when he spoke at the Irish Co-operative Organisation Conference (ICOS) annual conference in Limerick.
"Regardless of the rights and wrongs of the situation, any sector that is subject to ongoing disputes between producer and processor needs to seriously examine itself," he told delegates.
The day of producing beef without an eye to the eventual market destination was well and truly gone. If the market demanded a particular quality or age of animal, then the producers would have to respond, he said.
The same was true of processors and he told the factories that the pricing system for animals would reflect the needs of the market in terms of quality and also "include a level of transparency and clarity which engenders the full confidence" of the producers.
He criticised the factories for failing to take advantage of the reopening of the Egyptian beef market. Egyptians had demonstrated their faith in Irish beef and the EU was providing extra special export refunds exclusively for that market.
"To fail to take the opportunity thus provided is unwise in the extreme. I would strongly urge the industry to pull out all of the stops to regain a presence in this market, even if this demands a longer-term perspective," said Mr Walsh.
The second warning of the day came from Mr Mike Feeney, director of Enterprise Ireland, who said the beef industry was characterised by what could only be called "a destructive tension" between the two key stake-holders, the producers and the processors.
"In reality, if a broad degree of consensus cannot be achieved on how the industry must address the challenges of scale, quality and markets it now faces, the industry will decline in the face of WTO and growing competition in our traditional and EU markets from South America, Australia and New Zealand," he said.
"If we do not agree a shared vision and action plan now, the industry is facing very serious difficulties in the coming years.
"There is a critical need for an agreed development strategy to be implemented for the sector," he added.
Mr Feeney said that, despite major efforts to conclude a partnership between the factories and farmers, consensus had yet to be achieved on how best the industry could restructure itself.
"Even since 1998 when the industry study was initiated by Government and Enterprise Ireland, the numbers of cattle slaughtered have actually declined from two million in 1999 to 1.66 million in the current year," he said.
The industry was at a crossroads, he said, and there was now a situation where increased plant capacity was pursuing a reducing cattle supply, and at the same time revenues were declining and costs increasing.
The Irish Farmers' Association, which has been protesting at meat plants for five weeks, causing shut-downs, will decide later this week whether or not it will resume the protest, which has been suspended for the past 10 days.