Future of Tillage Sector: Discussion

I remind members, witnesses and those in the Gallery to ensure that their mobile phones are completely switched off for the duration of the meeting. The purpose of this meeting is to discuss the tillage sector. I welcome members of the Irish Grain Growers Association, Mr. Bobby Miller, chairman; Mr. Clive Carter, secretary, Mr. Pat Cleary, environmental spokesperson, and Mr. James Kelly, malt barley spokesman. I thank them for coming before the committee today. We are delighted that they are able to contribute to the committee's examination of the future of the tillage sector.

Before we begin, I draw the attention of witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the House or an official either by name or in such a way as to make him or her identifiable.

I invite Mr. Carter to make his opening statement and members will then put questions to him.

Mr. Clive Carter

The Irish Grain Growers Association was set up over two years ago due to a lack of representation in our sector. I will give a brief synopsis of the tillage sector in its current form. The total area under tillage in 2017 is 316,000 ha. This is made up of 264,000 ha of cereals and the remaining 52,000 ha is made up of beet, maize, rapeseed and protein crops. It is interesting to note that the cereal acreage is down 5.7% in 2016 and over 14% in the past five years. These are scary figures for us. It must be noted that there were over 1 million hectares of arable area in pre-war times. A focus on beef and dairy cattle to supply the British market, as a result of a vast proportion of grassland there had been ploughed up to produce cereals and vegetables to feed Britain's growing population, resulted in the majority of land here being used to produce monocrop grass and the tillage areas remained in a few small pockets throughout the country, mainly in the south, the east and the midlands. The area of land used for arable farming in Ireland is under 9% of the total of land in agricultural use. The remaining land is either grassland for beef, dairy or sheep, approximately 80%, or managed forestry, 10.8%.

We currently need to import over 1 million tonnes of animal feed every year. Ireland's temperate climate allows for some of the consistently highest yields in the world. The importance of the Irish tillage sector should not be overlooked. One acre of malt barley has the ability to produce over €60,000 in revenue per annum for the Exchequer. Bee, bird and wildlife populations thrive in well-managed tillage areas because there is always a constant supply of food for them. Locally produced crops keep jobs local. Employees in haulage, storage, processing and machinery sales and merchants and agronomists are all needed in this regard. Imported crops do not produce as many of these jobs in the economy.

We envisage a growing demand for premium food grade crops for use in the beverage industry and export food market, such as gluten-free oats and malt barley. We would like to see native wheat replace 90,000 tonnes of imported maize used in some Irish whiskeys. Irish whiskey production is set to increase by 300% by 2030. Demand for malt is forecast to rise from 200,000 tonnes to 300,000 tonnes. In the region of 4,000 tonnes of barley were used in the production of craft beers in 2016 and this is forecast to be 24,000 tonnes by 2020.

There has been a 31% increase in the number of dairy cows and the national herd overall has increased from 6.3 million to 7.4 million. Dairy cattle in particular require more protein, and an area of increased demand is Irish produced protein to replace imported genetically modified, GM, soya, which would give a fully traceable guaranteed Irish, non-GM product. The protein payments have greatly increased the use of, and demand for, beans and peas in rations.

As stated, the area under arable during pre-war times was over 1 million ha. A lot of land is under-utilised and there are many "naked acres" across the country. We are seeing a drop in area in tillage, mainly due to poor pricing of the products. If there was a fair price, farmers would be eager to produce more. We have the land base and technology to produce all of our feed and should not require any imports of animal feed. The Irish climate is almost perfectly suited to growing cereals. While we have difficult conditions, particularly around harvest, for example, this year, we do not have the extremes that other nations do, which gives us a reasonably consistent yield of grain.

We need first to promote our non-GM status and push for fully traceable beef, dairy, pigs and poultry to be completely GM-free using non-GM proteins in rations. There is no doubt that there are potential benefits to growing GM crops but it is viewed negatively by the premium consumer and we believe that Ireland, as an island nation, has a unique advantage in establishing a completely GM-free end-use product using native grains. There are endless marketing possibilities for Irish products if there is linked-up thinking between all sectors and relevant bodies. That said, tillage farmers should be rewarded for growing these crops with a unique selling point. It is impossible to try to produce these premium products while competing with imported GM feed. We would seriously encourage the Department of Agriculture Food and the Marine, Bord Bia, Origin Green and farmers to consider the idea of a GM-free Ireland. It must be understood that there are big changes in the area of GM and what is classified as such. Some farmers in the UK were in favour of Brexit because they thought it might open them to using GM technology on their crops. If we were to consider the idea of a GM-free Ireland, farmers would need a premium or it would not work.

Organic farming has great potential in Ireland and needs to be supported. Many cattle and sheep farmers are farming organically already and do not realise it. For the majority of grain farmers, however, the issue is marketing and selling the product. Apart from organic oats, there is not a huge demand for organic barley. The market for organic beer is a relatively small and the organic beef industry does not have the demand for organic barley or wheat that would entice people to convert vast areas used for conventional cereal production. Most organic beef is grass fed or finished on home grown forage crops.

The real future crops are those suited to Irish conditions, namely, barley, wheat, sugar beet, oats, beans, peas and rapeseed. The use of first-generation energy crops can have a positive impact on food and energy. Rapeseed can be used to produce pure plant oil, which can be mixed with diesel fuel, and a food oil. The crop produces approximately one third oil and two thirds cake, which is the by-product that can be used in animal feed. Likewise, sugar beet can be used to produce ethanol to be mixed with petrol. These crops can be considered multi-use in nature because of their ability to be used in the production of food or fuel. In both cases, the by-products can be used in animal feed. These crops are break crops, which means that they form an integral part of crop rotation and give a yield boost in the following cereal crop. Sugar beet, along with maize, can be used in anaerobic digestion, AD. Again, these are both break crops and their use gives better yields in the following crop. The by-product of AD, digestate, is a valuable fertiliser. Feed-in tariffs and renewable heat incentive to encourage capital investment in plants are required to encourage farm-scale AD plants, which have the added benefit of taking significant pressure off the electricity grid and keeping production local. There are many farm-scale AD plants operating in the UK and continental Europe.

Rather than encouraging valuable land out of production to grow energy crops such as miscanthus and willow, a better use of straw in combined heat and power, CHP, plants would be a more advisable route. Miscanthus and willow are single-use crops and, if required, could be grown on more marginal land. There is a need for 40,000 to 50,000 ha of energy crops to act as a carbon sink to mitigate against the 7.4 million cattle in the country. All arable crops can help to mitigate against this because arable farming is carbon neutral at worst. The introduction of more first-generation energy crops provides a more diverse rotation and encourages more ecological activity increasing, in particular, worm and bee populations.

I thank Mr. Carter.

I thank Mr. Carter for his presentation. I was interested in the emphasis on the non-GM aspect and the idea that it is the way forward for Ireland, as an island. Many of us have seen the possibility for Irish food to be sold as a premium product anywhere in the world. This requires that we set ourselves apart from everywhere else in order to project an image of an island which is green, clean and environmentally conscious. Organic does not suit everybody but is a huge aspect of this and having non-GM status would set us apart.

It was interesting to hear that only 9% of the whole country was in tillage. I would have expected it to be much more.

Mr. Clive Carter

It is even less now.

Is there an issue as to where it will end up if it keeps getting smaller? Will we run into a problem? We were in Paris this year and the person we met from the Ministry of Agriculture, Agrifood, and Forestry told us the whiskey market in France is huge, with the French drinking more spirits per head of population than anyone else in the world. They mainly drink Scotch but there is a huge opportunity for Irish whiskey and other beverages, as there is in many other places around the world. To do it properly we need to ensure the raw materials are grown in Ireland and that we do not import malt and barley. Can the witnesses expand on the opportunities that there may be? What is preventing those opportunities being realised?

I thank the grain growers for their presentation. It was said that one acre of malt barley could produce more than €60,000 for the Exchequer. Can Mr. Carter flesh that out a bit? This sector stands out in Irish agriculture in that we are not self-sufficient in it and it is unfortunate to be importing grain when we have such a strong natural capacity to grow it. Mr. Carter outlined how the percentage of land under crops has reduced in recent years. What immediate action should we take to redress this? The margin is the biggest difficulty and is driving down the numbers involved in the sector, along with the increase in the dairy herd in recent years.

Last year, a number of farmers along the west coast lost crops. What can the witnesses tell us about the grain crop this year? Are any counties in trouble? We heard about how much farmers in other countries are getting for GM crops. How do the witnesses see the economics of that? Mr. Carter said we need to build up our island as a GM-free food chain. How does growing GM crops compare with our own production methods? It is important that farmers are properly rewarded for what they produce.

Mr. Carter also mentioned anaerobic digesters. How well does this work in other countries and what steps can be taken to encourage it domestically?

I thank Mr. Carter for his presentation. The grain industry is at a serious crossroads. Coming up to Dublin this morning I saw combines working very hard and it is the second year in a row that we have had bad weather for the spring harvest. The price grain has been getting in the past couple of years makes the economics of grain production in this country very questionable.

Mr. Carter posed as many questions as he gave us facts, and that is not a criticism because he is entitled to represent his sector. He spoke of promoting a non-GM status for the country. Can that work in practice? We have an expanding dairy herd and our beef will always have a demand for grain but, at the current grain price, farmers are going to look at a value ration. How practical is it to give ourselves GM-free status and put a wall around our country? Flahavans pay a premium for oats for their porridge but it is a very limited market. Will Irish whiskey be another niche market? What tonnage potential does it have? If we get niche markets such as these going, it takes away from the argument that we can supply the dairy and beef industry. Can the sector carry through on this? Can we be GM-free and, at the same time, keep our other industries cost-effective?

The future for the grain sector is in energy crops and anaerobic digesters. Deputy McConalogue and I met an individual last week who has plans as to how this could be advanced. The tillage sector has a huge role to play in the production of gas and in meeting our emission targets but it is something on which we have not focused at all. If this sector is to survive, this is the way it will do so, with the by-products able to be used in the production of food.

I accept that GM-free status sounds lovely and it sounds like it would be attractive to the consumer, but both dairy and beef farmers have to be able to produce their products at cost. If we go down that road, is it achievable? I would seriously question whether it is achievable. To me, the future is in diversity and doing something we have never done before with our crops. We have lost our sugar beet industry. I see us going the way of New Zealand very quickly so that all we will have are Friesian cows and that will be the only industry we have. We see our suckler herd under huge pressure. Mr. Carter gave us the figures relating to cereals and the way they could drop. I am from Tipperary. The conacre sector is definitely losing land to grass on a rapid basis and most of it is going into dairy. If that slide is not stopped fairly quickly, it will be a retrograde step if we focus all of this country on one industry. Putting all our eggs in one basket is never a good thing. We must look outside. What worked for us ten or 15 years' ago will not work going forward. The price the world market is returning for grain is at such a level that we must be more imaginative about how we can help this sector to survive.

Mr. Pat Cleary

I will deal with Deputy Kenny's question about the area of tillage at the moment versus what happened historically. Mr. Carter or Mr. Miller will address the issue of acre of barley and what it produces. I will deal with Deputy Cahill's question about GM and energy and then switch back.

As we said in our presentation, there were one million plus hectares of arable land in the country in pre-war times. Why has it declined? It has done so for many reasons, some of which were policy driven at national level while others related to farmers and EU policy on subsidisation of certain sectors in the broader agri structure. We have somewhere in the region of 360,000 hectares. If one incentivises any section, it will develop. I will give the committee a very simple example. There is a protein payment for beans or peas. In the past three years, the area of beans has gone from less than 2,000 hectares up to something in the region of 15,000. It is a very good break crop. Deputy Cahill mentioned the loss of the sugar beet industry. Why did this happen? We could beat ourselves up over the reasons. Ironically, the EU abolished sugar quota restrictions this week in the very same way as dairy quota was abolished after the cap two and a half years' ago. There was a big promotion regarding expanding the dairy sector at national level but nobody helped us to get sugar beet back and I know this because I am involved in beet arable. People were not interested. I know we came in here to committee meetings, etc. It will come back with the right mindset. Arable farmers are very resilient people. The decline in the acreage of arable farming since 2005 is significant and that was one of the reasons. I will not delay too long on it.

In respect of GM and AD, we have huge potential on farm for biodiversity, including AD, and we can use the crops we grow in AD like maize, sugar beet and food waste. However, the problem is that if I try to get planning permission for a small GM facility on my farm, we are talking about four or five years in the planning structure. A friend of mine across the Border in Fermanagh to whom I sell straw has an AD plan. It took him eight months from start to finish in the planning process and his total costs were somewhere between £8,000 and £9,000. They have a very specific rural planning policy. There is nobody saying that Northern Ireland is less rigorous in its environmental enforcement. The same rules apply.

We must make a decision in this country regarding GM. We are talking about the expansion of dairy and beef farming. That is fine. They need to be fed but if we look at what is happening in the US, we can see that up to 30% of the shelves in most of the supermarkets are non-GM and the turnover of product on that segment if four times what is in the GM segment. We must ask ourselves whether we are going to go down that route. We do not know what is going to happen post-Brexit in the context of products coming in from the UK. Everybody has to make a decision as to whether we are going to go down that route. We are talking about labelling and branding Ireland so are we going to be fully traceable from the crop or animal? How are we going to label this? We have a great opportunity in the future but we must make a conscious decision. Certainly, we see our sector having huge potential in that.

Mr. Clive Carter

Deputy Kenny raised a point about what we require while Deputy McConalogue raised the issue of where we saw the malting barley producing €60,000 per acre. Mr. Kelly will back me up regarding malt. It is based on the amount of pints of Guinness or such that we get from a tonne of barley and the tonnes of barley the average yield or what people can produce. We get over 10,000 pints from a tonne of malting barley. Many people are hoping for a crop of above three tonnes per acre so it is 30,000 pints, whatever that adds up to. We have been getting that figure from excise duties on whiskey.

I apologise for cutting across Mr. Carter. Would every tonne be capable of producing the same amount? Does it have the same quality to allow it to produce the same amount?

Mr. Clive Carter

There would be very little in the difference. There would be different protein levels so lower protein would produce a little bit more and vice versa but it would not be huge variation.

So it is an average figure?

Mr. Clive Carter

Yes, that would be an average figure.

How much of our barley is malting barley?

Mr. Bobby Miller

About 10% of crops are malting barley. We are receiving €150 per tonne for malting barley - €155 or €160, that ball park figure.

Is that spring or winter?

Mr. Bobby Miller

Spring. Malting barley is only a spring crop.

That is what I thought.

Mr. Bobby Miller

The specifications regarding the quality we need to grow the crop have become very tight because the customer wants it. For this sector to survive, the farmer needs a minimum of an extra €40 per tonne. That is the equivalent of 0.1% of the price of a pint of Guinness in the countryside. I do not know what it is in the city. When one looks at the retail price of the product, one can see that we are asking for very little to support the tillage farmer.

Mr. Clive Carter

The farmer gets less than five cent per pint.

Is the figure of 10% a fixed figure? Is it what the industry wants or is it 10% of the malting barley crop?

Mr. Bobby Miller

No, it is 10% of the full cereal acreage, which is approximately 200,000 tonnes in Ireland.

Is that enough to satisfy demand?

Mr. Bobby Miller

Currently, but the demand is increasing. The problem is that the raw material can be sourced anywhere. Calling a product Irish does not necessarily mean the raw material comes from Ireland so one would have question the likes of Irish whiskey regarding how brands are allowed to call a product Irish when the raw material may not necessarily be Irish.

Mr. Miller referred to standards. Is there much rejection of malting barley?

What are the rejection levels? Is what is being grown accepted for malting and for brewing?

Mr. Bobby Miller

It varies from year to year and it depends approximately 70% on the weather. In terms of the specifications and protein levels, there is a lot of science behind producing the product, that is, the pint or the bottle of whiskey, etc. There are different levels of protein, different diseases in the crop and different varieties. Many factors come into play. It is a highly specified crop to grow, yet we are getting the equivalent of feed prices for malt and barley at present, which is just not acceptable.

What was its equivalent?

Mr. Bobby Miller

The feed price for malt and barley. This is a growth sector but at present the farmer is not benefitting. In the 1970s, we were getting more for malt and barley than we are at present, even though the sector is growing so well.

A malting contract in the past was considered a prized possession.

Mr. Bobby Miller

It is valueless now. One could not sell a malt and barley contract because it is valueless now and, unfortunately, it has been led down that road by policy making and lobby groups. It would be an unfortunate state of affairs if the pint of Guinness or Smithwick's or Irish whiskey was made from imported raw material, but that is the reality facing us.

At the moment, is it known whether every pint of Guinness and every drop of whiskey produced in Ireland is coming from Irish product? Is it all Irish product?

Mr. Bobby Miller

No, not necessarily.

Are the witnesses aware of the breakdown?

Mr. Pat Cleary

Certain brands of Irish whiskey are using up to 40% of imported maize in its products.

That is 90,000 tonnes.

Mr. Pat Cleary

It is 90,000 tonnes of imported maize.

That is going towards producing Irish whiskey.

Mr. Bobby Miller


Mr. Pat Cleary

If we wanted to consider a proper model, we should look to the Scottish one. The Scottish climate is similar to or worse than ours. The Scottish brand and its global marketing is reflected in the price the Scottish farmer gets for producing the product. The quality assurance on those farms is strict and adhered to and they have no problem in labelling their Scottish whiskey as being 100% pure Scottish for that reason. There is, therefore, already a template.

How does the price correspond to the farmer? Is there a contract system as is the case here?

Mr. Pat Cleary

No, they get a substantial premium. There is a simple formula based on the feed price.

Mr. James Kelly

It should be recognised that Irish malt and barley is recognised as being one of the best quality malt and barley crops in the world. The proof of it is that in years gone by it formed, and still forms, the base product for one of the world's best known brands, namely, Guinness. Unfortunately, however, it is becoming less attractive for people to grow malt and barley. This is unfortunate in light of the booming whiskey and distilling industries. Irish malt and barley growers will have to be rewarded adequately for the whole industry to survive.

Mr. Pat Cleary

This does not just concern malt and barley. Historically, 30 years or 40 years ago, we grew most of our home-based milling wheat for flour. It is not that the climate has changed that much in the past number of years. However, now we do not have a milling wheat marketing strategy. It is easier for the merchants, R & H Hall and people like that, to go and buy 6,000 or 7,000 tonne in a batch from the UK or Scotland. It is not just malt and barley. The Chairman asked about the demise in the arable sector. I live in Monasterevin. In my youth, we grew milling wheat and drew it to Odlum's in Portarlington. It was very simple. We grew malt and barley and drew it into Minch Norton's in Monasterevin. We did not grow any feed barley at that time. The livestock sector was not significant. However, it is not just that. We can grow the best and the highest yields of feed barley and feed wheat for the livestock and dairy sectors, which is important, and we are making a huge contribution. However, we are importing a million tonnes of feed product from the UK at the moment which we could produce ourselves if the policy was right.

Deputy McConalogue asked what immediate measures could be introduced to help the sector. What would be helpful in the short term?

Mr. Bobby Miller

One of the first things I would like to see introduced is a quality assurance payment for quality crops and the full traceability of those crops. I wish to touch on Deputy Cahill's point about GM. We would have no intention of building a wall around the country as regards grain being imported. All we would be asking for is that what is imported is GM-free. We would not suggest excluding the importation of grain, which we must do, although it is unfortunate that we have got to the point that we have to import our grain. However, everything is about branding and marketing these days. It would make marketing sense for all sectors in this country, whether dairy, beef, lamb or otherwise, to chase the higher end markets.

Some 11% of the world's baby formula comes from Irish dairy products and traceability is key for this market into the future. Lately we saw the repercussions of the Brazilian beef scare. Our focus has been the dairy sector, which is doing very well and fair play to those involved. We are not here to chastise them for one second. However, if there is a food scare of some description and it is traced back to this country, it could have a damning effect on the rural economy. At present, inside the Pale - a word I hate to use but it is easy for lads from the countryside to understand the term - there is great growth. However, if there is any twitch at all in the wrong direction, those in the countryside are looking at devastation. It is, therefore, key that we have traceability and are aiming for the higher end markets.

The tillage sector affects every other sector in the country. The merchants and food processors all realise that the tillage sector has to be sorted out. We have lots of solutions if people want to listen to us. I know everything will not be solved here today but we appreciate the offer to come here today to start the ball rolling.

Before we move on to the next lot of questions, I have to leave for another meeting. I ask Deputy Cahill, the Vice Chairman, to stand in for me for the next 30 minutes or 45 minutes. I apologise for having to leave. The next speakers will be Senator Mulherin, Senator Lombard, Deputy Corcoran Kennedy, Senator Daly and Deputy O'Mahony. Non-committee members will speak last. Is that agreed? Agreed.

Deputy Jackie Cahill took the Chair.

I apologise for not being present earlier. I was speaking in the Seanad Chamber and, unfortunately, I will have to go again because I have to take the chair shortly. If some of this has already been addressed, please say so.

On production and increasing demand, we see the increase in the number of start-ups in whiskey distilleries and the craft beer sector. The witnesses alluded to it. The increase points to increased demand for what the witnesses produce, crops. To follow through on that, much of it seems to be aimed towards the export market and we are making more whiskey and beer. How can the sector respond? Will it put more land under crop?

Is an increase in price expected or are they the international figures? Reading between the lines, I understand some of the issues that have been raised. I am interested to know the practical benefits or how the witnesses see themselves responding to it because it is presented as a positive news story for the craft beer and whiskey sectors, which are growing sectors supported by Government.

Regarding GM products, I understand the issue of marketing, public perception and consumer confidence. The situation in the United States is that a non-GM food product is the preferred product but GM was developed because it can produce a hardier crop to prevent pathogens and disease from developing. Of course, we do not just throw anything on the market but what is the position if the qualities of a particular GM crop are properly, scientifically accredited and approved? Do the witnesses consider our non-GM position a stronger one in terms of sales and the market? Do they have other concerns? I assume GM products would have to have their probity certified and tested. We cannot just put products on the market.

The industry is at a crossroads, as the Vice Chairman said. The biggest issue at the moment is the lack of confidence. There have been five years of depressed prices. Large numbers of acres have been taken out of the industry to be used for other purposes. The drive has been towards the dairy market. Even this year has seen changes in my part of the world regarding tillage farmers moving to big dairy units. I have a great worry for the industry. We need to have a tillage industry if we are going to have a successful dairy industry because we need straw and the land for nitrates so both need to work together. At the moment, we are at a crossroads and there is a major confidence issue in the industry. The big issue is how to build that confidence. Traditionally, the single farm payment that most grain farmers receive was quite high per hectare. With the renegotiation of CAP happening in the next few years and as a result of Brexit and everything else that is going on, it is not guaranteed. If the CAP deal goes wrong, it could be the death knell of the entire industry. It is a huge issue. If the CAP deal reduces by the amounts the British are paying into the single farm payment scheme at the moment, it will have a huge knock-on effect on the grain industry more so than any other industry. I have a great fear about how it would survive taking into consideration the past four or five years of very bad prices. It is one of the key issues.

We are having a welcome debate trying to make sure the industry survives. The beet industry has been lost over the past few years, there have been bad prices and Brexit is coming. The confidence factor is the biggest issue. There are grain farmers in my part of the world and it is bad enough that they are doing badly, but the other industries are doing well. It has a knock-on effect. They do not wish ill on the other industries but the confidence has been drained from theirs. The bad weather last year in my part of the world had an awful effect on them. This year was not much better. Yields might have been somewhat okay but moisture killed them when they were harvesting in the past few weeks.

I question the view about where GM will come into the workplace. Protein and protein-products, in particular soybean, is a big core industry and how we get that product into farm feeds is an issue. If we were to have a ban on GM coming in, how would the import of soybean affect the core price of meal going into the beef and agricultural sector? Would it have a major knock-on effect if the industry did not have the capability to draw that money back down through higher prices? Are there higher premiums at the moment for proposed GM milk, butter, yoghurt or baby food? I am not quite sure on that point. It is something we need to tease out. Perhaps it is something we need to ask the dairy industry about. How would it cope if soybean was used on a GM-free basis? As the Vice Chairman said, we are at a crossroads with the industry and how we move now will be very important.

I thank the witnesses for their presentation and answers so far. I want to ask them about the potential in terms of diversification of the use of crops for not only human consumption, but animal consumption and energy. I am thinking of oilseed rape, for example. I know it was not being processed here. Are we still exporting it for processing? Do the witnesses see it as an opportunity we are missing by not processing it here and using it as a product for animal feed? That is the first question.

I have a similar question about pulses and whether we are exploiting the potential that pulses have on all of those levels. My other question is about sugar beet and the fact it can be so successfully used in bioethanol plants. Do the witnesses think it would be a good way for us to proceed here to meet our targets and potentially for exporting? My other question is about the failure of the experiment with willow and miscanthus. Do the witnesses have any views on why that failed or what was wrong? On the face of it, it looked as though it would have been ideal for generating a crop that could be converted into energy. How did that fail and are there any lessons to be learned from that failure?

A number of the issues I wanted to discuss have already been mentioned and I look forward to the answers. I am from the midlands where we do not have big holdings in any sector. When I was a young lad, and up to 20 years ago, nearly every farm was a mixed farm. Farmers will get no cheaper feed, whether on their own dining tables or for feeding the stock, than growing their own.

It was farmers who made the conscious decision to move more towards livestock and dairy farming and away from tillage farming. It does not make sense. There is an argument every time one meets a dairy, suckler or beef farmer that, for example, Joe down the road is only getting €130 a tonne for his grain yet another farmer is buying it back in to feed the cattle at €250 or whatever. Why did farmers make that conscious decision and walk away? How do the witnesses propose getting them back? The witnesses mentioned quality assurance and guaranteed prices. If in the morning there was a major seachange, I cannot see those farmers going back. The land capacity is not there for the people who stuck with the tillage or the dedicated tillage farmer to expand. What do the witnesses suggest would be the best way of increasing the tonnage under those circumstances?

The grain sector got a hammering last year and again this year in our area. Perhaps the climate is a little bit better down south. I drive out a country road every day to get to my house. A neighbour drove a combine harvester into a 14-acre field last Saturday fortnight and he finished cutting last Monday. That combine sat in the field for about three days shy of three weeks. If the witnesses got everything they are looking for here today with regard to price and quality assurance, they will find it very hard to get the man to whom I referred to sow grain again next year. How could such a situation be overcome? None of us is in control of the climate. It is a major issue. The witnesses are talking about enhancing, improving and increasing tonnage or output when that barrier is there and has been there for two years running. There are many lads who will not come back next year irrespective of price. How do the witnesses see that affecting the bigger picture going forward?

Mr. Pat Cleary

I will ask Mr. Carter to reply to Senator Mulherin's question. I will respond to Senator Lombard and Deputy Corcoran Kennedy.

In response to Senator Lombard, the reason we are still in business is that over the past 20 years we have become more efficient. We are producing more tonnes per acre, and we are using better agronomy and better crop husbandry in conjunction with the new varieties available. We are hearing this propaganda about the dairy sector and that there is no future. There is an adage that people should not put all their eggs in one basket. People should remember that not so long ago we saw the risk of something like BSE or foot and mouth disease wiping out a sector and we need to have some form of resilience there.

On the CAP and the benefits of the tillage sector, one of the other issues will be climate change. The one sector that mitigates and has a positive story to tell is the arable sector. Members should consider what we are doing in the context of greening at the moment - ecological focus areas, cover crop and minimal cultivation are all contributing to addressing climate change. Ironically the greening requirements for the tillage sector are much more rigorous than for other sectors. We do not mind; we will comply as long as we are incentivised.

Why is the tillage sector in decline? For 30 years not one cent was put in. People have talked about the CAP but TAMS is the first scheme in 30 years to give any funding towards the tillage sector. This is because nobody asked for it. We were not being properly represented. That is why we are here. We need to stand up for the sector. Some people argue that the tillage people have big single farm payments. The only reason they have big single farm payments is because of economies of scale and they have to take bigger acreages of land every year. When one drills down into that, there are probably four, five or six families being paid for out of that because 80% of tillage farmers lease land - 40% of all the land we farm is leased. There are very lucrative incentives for farmers to lease at the moment - the armchair farmers, who take no risk while we do all the work. That has a positive effect.

The need for the soya bean was mentioned. What is wrong with using Irish beans? Have members seen the difference between a soya bean and Irish beans? When one looks at them, they are both beans. One is GM and the other is not. One is Irish and the other is imported. The other difference is that it is possible to get the Irish product for considerably less. The protein incentive has made a huge difference. Why not use Irish proteins in our crops?

Senator Paul Daly mentioned the weather and farmers harvesting crops at this time of the year. Why do farmers not grow more winter crops? Most of the good quality grain this year was produced from winter barley which was harvested in July. There is not enough promotion to make people aware of that. We were in our field on the day of the Leinster final and we were cutting at a moisture level of 15%. Farmers would love to be cutting at 15% today. There is another way. The straw we produced at that time was a premium product. In the past five years prices have been down, but in the past five years winter barley yields on Irish farms has been on a par with or better than those of any farmers in Europe. We have the climate if we use the right crops.

Mr. Clive Carter

The Chairman said he thought the future of the sector was in energy. He suggested we should focus on energy and use the by-products for food. I think that is the wrong way to go. Energy is at a certain price per kilowatt-hour. However, if we push premium product, and market and process it, we can add value at each step. It was suggested that we do something different that we did not do previously; I believe that is what we are doing. There is no need to reinvent the wheel. We need to do something different, add value to what we are producing, do what we do and do it better rather than just completely turning things on their head. There is still potential to produce energy from crops, but we should try to focus it more on by-products and areas after food production.

Deputy Mulherin spoke about whiskey. If there is a price for a product, the demand will be filled; it is simple economics. For an extra €40 a tonne, they would get all the barley they want and vast acreage of other crops would be put into barley. In my area in Laois, there has been a complete turn the other way. It used to be a complete malt area and has gone more towards feed grains because people think there is more money in feed grains at the moment. However, if there was an incentive to grow malt barley that area would turn around again and we could produce the extra barley for distilling.

She asked whether on a scientific basis we had any issues with GM products. We think it relates more to marketing. There are potential benefits to GM. We are not fully aware of everything but there are issues as well. It not just a blanket statement that GM products are easier for farmers to grow and that all farmers would prefer to grow GM products. As we have seen in America and elsewhere, there are problems down the road with GM products. That said, there have been big changes with GM. It is not from a farming point of view, but from a marketing point of view. An all-Ireland non-GM island is the way for us to go. We have a niche market and we should encourage that.

Mr. James Kelly

Senator Paul Daly asked how the tillage industry can survive. It will survive with support and incentivisation by all the relevant bodies - Government, Bord Bia, Origin Green, etc. We produce some of the best quality produce anywhere in Europe, if not the world, allied to the highest yields. That is achieved thanks to the climate here and our expertise and willingness to learn as growers and producers of these goods. Some of the supports and incentivisation that could be included would be the quality assurance, and capital allowances for the tillage sector to upgrade machinery, which would help farm safety as well as everything else, buildings etc. It would be of great help to the tillage sector.

We also need help in reintroducing the sugar beet industry. Especially in our area the sugar beet industry was a major loss to the tillage sector and the arable sector in particular. There are great prospects and there is a great future there if the right incentives and encouragement were given to those promoting the reintroduction of growing sugar beet in Ireland.

As Mr. Carter said, we would have no problem producing malting barley if the price was right. Some of the most experienced and long-term growers of malting barley are moving away from production because they are not being adequately rewarded for growing the crop.

Mr. Pat Cleary

Deputy Corcoran Kennedy asked about the potential diversification into energy with crops like sugar beet.

She also asked about oilseed rape and I apologise for not answering that. Oilseed rape is grown on many arable farms. At present, it is generally used in feed. It is not processed in Ireland. There is no processing plant for pure plant oil from oilseed rape which can be used as biodiesel. There was an incentive some years ago and it was withdrawn. Many who had invested in those processing plants went broke.

Oilseed rape is a versatile crop. Energy can be produced from it. The cake that is left after it has been rolled is a high-protein animal feed. It is a fantastic break crop. There are many people in the UK making other food products apart from cooking oil. Mayonnaise can be produced if other products are mixed with it. It is a very versatile crop.

Need we say any more about sugar beet? Its primary purpose initially was sugar. It can be and is used successfully for anaerobic digestion, AD. All the surplus sugar beet in Germany is used and has replaced atomic energy there. A substantial amount of that by-product was beet pulp, which was a great feed for livestock. Ethanol can be produced from it, which is blended with petrol, and it also has industrial uses. One of the relevant issues relating to that crop is it is the most carbon positive crop that can be grown because it filters or cleans the air. As a practical equation, if there is a herd of dairy cattle grazing in a field and a field of sugar beet beside it, that area would be carbon neutral.

The reason the willow and miscanthus did not work was quite simple. We are talking about first generation crops that are used in crop rotation that do not take the land out of production. In fact, all these crops will suit the Common Agricultural Policy, CAP, as a break crop at present with the three-crop rule, and with the following cereal crop there will be a bounce of 30% to 35% in yield. If a person grows willow, that land is being taken out of production forever because it grows a root down into the ground. One cannot switch after year three and not grow willow anymore. Maybe there are areas where it can be used. Arable farmers tried miscanthus and it did not work.

We will not take our land out of production. It means that much to us. If there is marginal land that people want to develop, that is fine, but we should not be asked to take arable land out of food or grain production. We will not do it. It just will not happen. There are plenty of first generations, for example, the beet and maize for AD. Obviously, we need to look at the whole REFIT tariff, the renewable heat incentives, etc. I mentioned briefly that planning issues are a huge problem on farms. We were put through the same rigours as those who would be doing industrial-type development, which is crazy. If the committee is serious about this, it should look at the whole process and how we are going to develop it in the future.

Do the Irish Grain Growers have any objections to GM energy crops? What are the gentlemen's view on GM energy crops?

Mr. Bobby Miller

We would rather see Ireland look for GM-free status. As a country, we do not have GM-free status. There should be a debate about GM in this country to educate people. We hope it would be a level-headed debate about it. There can be a lot of propaganda about GM. It has its pros and cons. As of now, we have no interest in GM of any description in this county.

I will cover a couple of other points. Mr. Healy covered our costs. We are starting a pilot project with tillage farmers. Our biggest cost is machinery. We are starting a pilot project to reduce our costs from a machinery point of view. We need more research and development in this area. The tillage sector has been neglected as regards research and development. That would include GM. It would include every sector, for instance, a person's food grade. As a group, we are proactive about the way forward for the tillage sector.

The weather and climate were mentioned. As Mr. Cleary alluded, we are, if not carbon positive, at worst carbon neutral. By getting rid of the tillage sector, we are adding to this big bill that is coming down the road from Europe for being a carbon negative country. Therefore, there are many reasons, from environmental to traceability of food, to invest in the tillage sector.

A government's choice on how it feeds its country is being decided here as well. The quality of food should be paramount to a government. If we get rid of our tillage sector, we will be dependant on imports. I mentioned the Brazilian beef scandal previously. We would be leaving ourselves open to all this as a nation if we do not halt the slide of the tillage sector. A total of 85% of our income comes from the so-called cheque in the post, with only 15% of our income coming from our labour. At present, we are working for €1 or €2 an hour as farmers. Our income is on average just over €30,000, far less than average industrial wage. There are strikes, such as there were with teachers, Luas drivers and others looking for far more money. As far as we are concerned, we are being totally ignored in this sector. We had no voice up to now. Our aim as a group is to lead this sector out of the present doldrums.

If it does not change now, we will be eating sandwiches in a couple of years' time and we will not know the exact origin of what we will be putting in our mouths or in our children's mouths. Currently, 250,000 sandwiches a day are eaten in this country, the origins of which cannot be guaranteed. They are going into schools, the public sector and so forth. That is where they are headed at present. The problem is here already. It is up to Government to ensure its people are fed properly and have traceability of their food.

We will finish up. Deputy Corcoran Kennedy wants to ask another question.

That comment by Mr. Miller stimulated something else in my head. What are his views on what will happen with soil in the future with climate change? There are global concerns about the erosion of soil and our potential to feed ourselves. Mr. Miller's point about being able to feed ourselves and ensure our soil is protected is valid. Do the Irish Grain Growers have concerns about that, in terms of the amount of land that is being affected by flooding and the quality of the microbes in the soil, etc., that is affected by climate change? Do they have any thoughts on that?

A small point I was reminded of when Mr. Miller was talking about GM and stating that he does not really have an issue with it is that, with the consumer, it is down to perception. Ten years ago or more in Leitrim County Council when I was a member, there was a debate about GM with a scientist from Teagasc and someone opposed to GM. The scientist made all sorts of arguments about GM, such as how it was perfectly safe and there was no scientific reason for anything being wrong with it. I asked him, if he had been there ten years previously and I had asked him if it was safe to feed meat and bonemeal to cattle, would he have told me it was scientifically safe, and he told me he would have. However, science turned out to be wrong. The logical problem many consumers have is where one does something which is a twist of nature to a fair extent. There are situations where they are making GM crops which are frost resistant.

They go pretty much down the road of wondering what is going on here. There is the potential for something to go wrong one day. If we are depending on bringing in genetically modified, GM, products, or if we go GM in Ireland for many of our products, where will we get our food if some catastrophe happens? That is the danger that the vast majority of the public have in their head. Ultimately, we as politicians know that members of the public are not that stupid and it is not that easy kid them. This is a matter in which we must trust the public gut feeling. As has been said, the public's gut feeling with GM is that, in general, it is wary of it. There is an opportunity for Ireland in this and I support the witness in what he says in this regard.

In my part of the country, in Leitrim and much of the west of Ireland, many trees have been planted, which is a permanent change of land use. This has been done to make a carbon sink. It would make much more sense to support the tillage industry, rather than having whole townlands and parishes in my part of the country where nobody lives any more because there is nothing but trees around. That does not make sense either. I support both aspects of the witness's comments.

Mr. Pat Cleary

Soil structure is very important to us. We are mandated under the Good Agricultural and Environmental Conditions, GAEC, that we must maintain a minimum of 3.5% of the soil on soil organic matter. We do that within the tillage sector. Historically, farmers were mixed farmers and there was farmyard manure and rotation was more diverse. Tillage farmers now, and especially since the sugar industry went, have become involved in continuous tillage. That has had to change because there is a three crop rule and we must introduce a break crop in rotation. We do what is called minimal cultivation, so much soil is non-inversion. Anna May McHugh will not like hearing this but the plough is becoming obsolete in certain areas and some farmers are direct drilling. They are not even doing minimal cultivation. We do a nutrient management plan and the Department is mandated to look at our soil structure. We have analysis on that.

People may ask what the earthworm population has to do with soil but it is very important. If a farmer is not looking after soil and is undertaking continuous tillage without reintroducing soil organic matter, the earthworm goes away and the soil structure is dead. On my farm there is compost and I make it from green waste. We started doing it when we lost the sugar industry. It is not just the soil organic matter that has improved but our yields have been enhanced. It is a regulated sector and it should be controlled by the Department rather than others. There are five or six regulatory bodies that I am responsible to. It is crazy. With the tillage sector more than any other, soil structure is very important, as one will only get out what one puts in. If a farmer does not treat the soil correctly, yield will be lost and there is no money in that for us.

We have covered the GM issue and Deputy Kenny was making an observation. I thank the witnesses for the presentation. They represented the sector very well, making their points very forcibly. We will take on board everything said today and prepare a report.

Sitting suspended at 5.45 p.m. and resumed at 5.50 p.m.