I thank the Chairman and the committee for the invitation to address this afternoon's meeting. As members will know, 2018 has presented the agricultural community with some of the most challenging weather conditions in recent memory. Significant storms and an exceptionally wet spring period was followed almost immediately by two months of exceptionally dry hot weather. This placed an unprecedented level of pressure on fodder supplies on livestock farms but also significant challenges for the wider tillage and horticultural sectors. Over the last number of weeks, thankfully, there has been some welcome return of rainfall and more normal growing conditions in some regions and this is now providing conditions that will be beneficial in terms of late season production. While welcoming the improvement in growth conditions, I would like to give the committee a full account of the actions and measures that have been put in place to support the sector in meeting this challenge.
Following the fodder difficulties of last winter and the spring I put in place a stakeholder group, chaired by Teagasc, which included representatives from the co-ops, banks and farm bodies, among others, to co-ordinate advisory messages to farmers this summer. At that time, its clear focus was around replenishing depleted stocks of fodder.
During the summer period, I requested that the group co-ordinate advice on managing grazing and fodder conservation throughout the extended period of extraordinarily dry weather and I personally engaged with the meetings of this group. In addition to co-ordinating advice, the group has also delivered a range of initiatives, including zero-interest credit facilities by some co-operatives to members to support the necessary purchase of feedstuffs and fertiliser, along with price rebates by some co-operatives on the main feed and fertiliser inputs for when the growth returns. Furthermore, tailored practical advice is being shared across the group on dealing both with the current weather and on filling the significant fodder gap.
On 26 June, I asked Teagasc to launch a national fodder survey through its client network, as well as clients of the other fodder group stakeholders. Initial results indicated a national fodder deficit of 18% but Teagasc estimates that the national fodder deficit was closer to 28% as a result of additional supplementary feeding taking place at the time. Based on this survey evidence, the overall priority was to conserve as much fodder nationally for the coming winter when the opportunity arose and to take advantage of growth as it resumed. This would be supplemented by imports as required. A further survey is being undertaken to provide an updated position and this will be repeated again later this autumn giving us a clear view of progress.
A dedicated helpline was established to provide advice to farmers affected, thereby providing valuable guidance and an opportunity to share the challenge. This support was supplemented by a series of local meetings or clinics by both Teagasc and the major co-operatives where farmers obtained direct support from advisers on the spot. This helpline service and local clinics were open to all farmers, including non-Teagasc clients.
I met the main banks on issues relating to the agrifood sector and to highlight the need for access to finance for farmers. They gave a commitment to service the financing needs of the sector and specialised response products have been introduced.
In July I highlighted the difficulties facing Irish farmers with my EU ministerial colleagues at a meeting of agriculture Ministers in Brussels and on 24 July, I met Commissioner Hogan and briefed him on the impact on Irish agriculture of the dry spell. I secured early agreement from the Commissioner to pay higher advance payments this autumn following this meeting. Advances for Pillar 1 and 2 payments will be increased to 70% and 85%, respectively, resulting in €260 million in additional cashflow for farmers at a vital time of the year. I also proposed certain flexibilities for participants under the GLAS scheme, which would replenish their fodder stocks for the winter period. I am delighted to have secured the agreement of the European Commission for these measures, which are now in place since last Saturday, 1 September, and which together bring a potential additional 270,000 ha into fodder production. Specifically, the two measures are first, an amendment to the specifications for 2018 to provide for the use of low input permanent pasture parcels for silage or hay production in the period 1 September 2018 to 1 December 2018. There are 37,800 GLAS participants with the low input permanent pasture action covering an area of over 269,000 ha. The second relates to the environmental management of fallow land. For 2018, off-takes will be permitted on a once-off basis in the period from 1 September 2018, after the nesting season, to 1 December 2018.
For those farmers growing catch crops to fulfil obligations under the ecological focus area, EFA, element of the greening scheme, flexibilities have been secured with regard to the species sown and the time period for which the crop must remain in the ground.
On 3 August, I announced a €2.75 million fodder production incentive for tillage farmers. This is a new measure aimed at encouraging tillage growers to actively engage in the fodder market by increasing the production of fodder this autumn on lands that could otherwise lay fallow over the winter months. This measure will provide an incentive of €155 per ha for tillage growers who grow a temporary crop of short rotation grasses for fodder production over the winter months and €100 per ha for those growing catch crops such as fodder rape, turnips and brassica crops. Currently, more than 23,000 ha of catch crops are supported under the agri-environment scheme, GLAS. This additional funding commitment aims to incentivise a doubling of this area. I am confident this measure will support tillage farmers to supply into the market for fodder. Tillage farmers are a critical part of our agricultural sector who supply the brewing and distilling industry, as well as grain to the feed industry and straw to the livestock sector while also delivering other benefits. This measure is therefore focused at supporting tillage farmers, who also have encountered a difficult spring and summer while also aiming to maximise additional short-term fodder production.
Following agreement with my Government colleague, the Minister for Planning, Housing and Local Government, an extension to the closed period for spreading of chemical and organic fertilisers has been granted. This is in place to allow farmers to capitalise on autumn grass growth for fodder production. This extra two weeks will allow application of manures up to 30 September and 31 October, respectively, and again maximise the opportunity for grass and fodder production.
Additionally, given the identified shortfall in national fodder availability, I announced details of a €4.25 million fodder import support measure for autumn 2018. The measure will reduce the cost to farmers of imported forage including hay, silage, haylage, alfalfa and others from outside the island of Ireland. The measure will operate through the co-operatives or registered importers and will cover forage imported from 12 August 2018 to 31 December 2018 and will be subject to EU state aid, de minimis, rules. I wish to confirm that while the measure will operate through the co-operatives or registered importers, the beneficiaries will be farmers who need supplies of fodder.
I announced in budget 2018 that my Department is considering the development of potential further Brexit response loan schemes for farmers, fishermen and food businesses, following on from the success of previous schemes. My Department has worked with the Department of Business, Enterprise and Investment, the Department of Finance, the Strategic Banking Corporation of Ireland, SBCI, and the European Investment Bank and European Investment Fund, to develop a longer-term capital financing loan product to be available to farmers, fishermen and SMEs, including food businesses. I hope to announce progress on the agrifood elements of this loan product soon.
On the working capital needs of farmers, I continue to liaise closely with the main banks and other stakeholders. I believe the loan schemes delivered by my Department to date have stimulated the development of welcome new initiatives on both short and longer-term credit by financial institutions and some dairy co-operatives. I have encouraged these initiatives and will continue to keep working capital requirements under review.
It has been a very challenging year, including mentally, for farmers who are coping with the conditions. I am confident that taken together, the range of measures I have introduced to date, which are primarily targeted at producing as much fodder as possible from our own land, provide the most effective response to a fodder shortfall. It is also important to recognise that the support that was made available through the helpline and workshops that have been organised by both Teagasc and the co-operatives was invaluable in allowing farmers discuss the challenges on their own farms. A problem shared is a problem halved.