A major study of the Irish dairy processing sector, jointly funded by the Department of Agriculture and Food, Enterprise Ireland and the Irish dairy industry itself, was published in March of this year. The report, prepared by Prospectus and Promar International, identified a number of weaknesses associated with the Irish dairy industry and suggested key strategies aimed at ensuring the long-term success of the industry in an increasingly competitive trading environment. Issues such as scale, cost efficiency, greater investment in research and development and new product development are central to the consultant's recommendations.
It is clear that less dependence on commodity type products and intervention, and a move to more value added products is a fundamental requirement for the development of the sector. It has been shown that our international competitors invest more in new product development and this is an area which will have critical importance going forward. Ireland's dairy output must be dictated by the needs of the marketplace and I have no doubt that product innovation will be a critical element of dairy processors' future business plans. The prepared consumer foods sector is the fastest growing sector of Irish industry. My Department has been actively involved in the prepared consumer food strategy 2003-06 which addresses the continuing market-led move away from basic food products, towards prepared food products. This shifting trend has been prevalent in the dairy sector for a number of years, with Enterprise Ireland and Teagasc actively assisting organisations to exploit the opportunities that exist. Their continued work in this area combined with my Department's contribution to the funding of the food research programme will provide valuable support to the industry in the years ahead.
To assist the discussion on the future development of the sector, and to address the strategies required to bring about the changes necessary, I have, over the past few months, had a series of meetings with representatives of most of the main processing undertakings. I also convened a dairy forum at which all of the main producers and processor organisations were present. This forum afforded an opportunity to all sections of the industry to give their views in relation to the present state of the sector, the changes necessary for the future and how these changes might be achieved. Of course, the final decisions relating to investment in change rests with the management and boards of the processing undertakings themselves. These are commercial decisions which must be taken within the constraints inherent in every organisation. I will, however, continue to encourage and support the industry to take the steps necessary to ensure a viable and successful future for the sector in an increasingly competitive environment.
Question No. 225 answered with Question No. 214.