I raise this issue because of what is happening in relation to export refunds and the impact it will have on beef prices. As late as last week my colleagues and I in the Opposition with responsibility for the Agriculture portfolio raised the crisis which has enveloped the sheep sector. I pointed out on Question Time last Thursday the serious implications of a reduction of 7.5 per cent and 5 per cent, respectively, on export refunds for the beef and live trades. In his reply, the Minister confirmed that he was concerned about this matter and that he would take up the case with Commissioner Fischler as a matter of urgency and would do all he could to alleviate the difficulties that the reduction in export refunds is having on Irish exporters.
On the following day we had the extraordinary situation where the EU Beef Management Committee, at its meeting on Friday, 17 November, decided to cut export refunds further in respect of live cattle and beef by 25 per cent with immediate effect. This is an outrageous situation which the Minister has allowed to happen. It is obvious he does not have the clout to deal with the issue. This is the fourth reduction in export refunds since September. Since then export refunds for live cattle have been cut by 45 per cent, which represents a drop of £29.50 per hundred kilogrammes while refunds on beef have fallen by almost 40 per cent or 47.5p per kilogramme. This is an unprecedented attack on the export refunds system which particularly affects the Irish agriculture and beef sectors. Our beef sector is dependent on 70 per cent to 80 per cent of its produce being exported.
One of the most successful means of maintaining confidence in the market has been the competition between the live and processed trade and the ability of our processors to get markets outside the EU which has allowed for the payment of export refunds. In terms of the industry the refunds are worth £300 million per year. The fact that the Minister. Deputy Yates, has allowed a 45 per cent reduction in export refunds on live exports since 1 September and a 40 per cent decrease in export refunds in our meat trade since 1 September will mean a loss of £120 million to the Irish cattle and beef industry for the coming year.
We have had silly statements from the Minister, Deputy Yates, since then stating that he did not expect the refunds in cuts to have an immediate impact on the export trade or cattle prices. These statements are mindboggling in their naivety. To suggest that the live trade will not be affected immediately is not facing up to reality. The Minister deplored the cuts in export refunds when the reduction was 7.5 per cent and 5 per cent, respectively, for the live and beef trades. This huge reduction of 25 per cent for both the live trade and the meat trade means, to quote the most recent statement from the Minister, that he is "incensed". If the Minister is not careful, he will be heading for an act of self-emulation shortly because he has had no influence whatsoever in dealing with this matter in a coherent fashion when the beef support regime for Third World markets had been practically dismantled under his stewardship since September.
I sympathise with the Minister of State, Deputy Deenihan, that when there is bad news too often he has to face the music. It is the responsibility of the Minister, Deputy Yates, in the Council of Ministers to fight the case for Irish exporters involved in the live and processed trade. Too often the Minister has been seen to create a distance between himself and the tragic situation which is the result of his mishandling of this affair. The fact that the rhetoric does not relate to reality is coming home to roost. We are dealing with a crisis in the sheep sector against the most benign background that any Minister for Agriculture, Food and Forestry could come into office: within 12 months the sheep trade is in crisis, and now the beef sector is in crisis because of the mishandling by this Minister.