LIVESTOCK producers will need much better prices for their cattle if they are to stay in business under the new farming regime.

The National Beef Association says abattoirs must tell retailers that they will have to pay better prices for their beef products.

It believes producers will not be able to cover their production costs under the single farm payment scheme unless the market eventually delivers about 250p per dwkg.

"Slaughterers must accept that the only way adequate supplies of home-killed beef can be guaranteed is if they pass back much better returns to finishers who deliver to specification," said Robert Robinson, NBA chairman.

"It will be impossible for breeders and finishers to continue with beef animals unless they get much more from the market than they do now, and we know that abattoirs will also go bust unless they too are paid enough to cover additional procurement costs.

"The message that must go back to supermarkets and other retailers is that if they want a well-organised supply of high-provenance, home-produced, beef they are going to have to pay more to make sure they get it."

The NBA has promised it will be just as critical if domestic prices are put under short-term tactical pressure by increased volumes of discounted imports from South America.

"We have warned before that beef produced under systems that rely on either rain forest clearance or indefensibly cheap labour are not welcomed by consumers who have already demonstrated their preference for high-provenance, high-welfare beef produced under the UK's excellent environmental and social conditions," said Mr Robinson.

"Rather than look automatically to the cheapest source of high volume imports to top up supplies, we would urge retail buyers to encourage domestic production by paying realistic prices for a product they know consumers want."

Mr Robinson said EU prices were rising now that intervention stores had been declared officially empty. "At one stage they held almost 1m tonnes of surplus beef but, now they have been cleared, the demand pressure is already rising and prices of 200p-210p are expected in the North of England and Scotland in May and June," he said.

Supermarket buyers have not been faced with such a relentlessly strengthening market before. "They should accept this development, give up their search for cheap non-EU imports, raise their retail prices, pay their processors more money and get ready for an even stronger EU market next year too," said Mr Robinson.

"If they do this carefully and well, they will find they have also made life easier for themselves by keeping the UK beef industry in business."