I am sure the Minister of State, Deputy Deenihan, is familiar with the chronic situation of the milk quotas in the south-west and particularly in Clare.
In 1993 a very detailed survey of milk quotas in Clare was carried out by the Clare Leader team. Milk quotas were valued at about £30 million. Some 2,500 farmers were supplying milk to the creameries and various co-operatives. According to that survey almost 1,800 medium and small farmers were likely to go out of business because of the way the control of milk production was developing. In the past ten years 1,000 farmers producing milk have gone out of business.
The fall-off in milk production in the county in the last ten years or so is about 4.5 million gallons. The bulk of those who have gone out of business were supplying less than 9,000 gallons a year; the bulk of the numbers currently threatened are in the category of 10,000 gallons or less. In the last few years there has been an increase in milk production. There has been controversy on the acquisition of milk quotas and the difficulties of young farmers in acquiring them.
Of the 2,000 milk suppliers in Clare, more than 500 would be supplying less than 9,000 gallons — they would be in the 15 to 16 cows category; about 650 would supply between 9,000 and 20,000 gallons. About 40 fairly large farmers — supplying over 20,000 gallons — would also be at risk. Many have borrowed very heavily and are under severe financial pressure. They would have around 35 cows. About 14 per cent of suppliers in Clare are over the 20,000 quota. This information gives an idea of the numbers of people involved and the relatively small amounts of milk produced. These are largely small producers who are finding it very difficult to survive and with the present difficulties in the store cattle business their problems are much worse than they were in the past.
The necessary infrastructure must be put in place to enable the larger farmers to stay in business. They have borrowed very heavily and are in financial difficulties. Many of them are now faced with the prospect of a super levy, especially those who were under the impression that if they continued to produce milk a facility would be provided for them.
The Minister of State will be aware that in the past six months or so many of these smaller farmers in County Clare were faced with the added burden of bills totalling up to £14,000 each for the over-supply of milk. They genuinely believed that if they continued to supply, a mechanism would be found either by the Department or the co-operatives to realign the quota to ensure that they would not have to meet those bills.
A new season approaches and farmers are beginning to plant for next year. Many young farmers who have taken over holdings from their parents face a serious problem, especially in County Clare, in addition to those farmers who wish to get into milk production and those who are being forced into this area because of looming difficulties in the beef industry and the production of small store cattle, which is the other side of their main farming activity.
I welcome the recent statement by the Minister for Agriculture, Food and Forestry that he intends to make some provision by way of new mechanisms to try to deal with this chronic problem which is forcing small farmers off their holdings. Many of them will not be able to continue and will be forced to leave their areas.
I appreciate that dealing with the milk quota issue requries not only an initiative by the Minister and the co-operatives but also one at European level. As the Minister is president of the EU Council of Agriculture Ministers it is an opportune time for him to take firm initiatives to resolve this issue, which is causing widespread anxiety and financial concern for many small farmers. Their small holdings, especially in the west of my own county, are in jeopardy and they look to the Minister, his Department and Brussels to solve the problem.
The Minister may advise that the farmers are well aware of the milk quota and how it can be dealt with. However, while milk production by these holdings represents a very small part of the overall EU budgetary problems, it is a major problem for those who are dependent on it as their main source of livelihood and income. It is an issue that will not go away.
The Minister and the Minister of State have an opportunity, especially during Ireland's Presidency of the EU, to use their influence with their colleagues in Europe to device a formula which will provide for the long-term viability of small family farmers who are dependent on milk production. In the past ten years 1,000 farmers in my own county have gone out of milk production. We must halt this and find a way to keep those who wish to produce milk in business, whether it be by way of incentives to encourage them to get into other forms of activity or whatever.
The Department of Agriculture, Food and Forestry must be criticised for announcing a few days ago the termination of the dairy hygiene support scheme which is essential to enable farmers invest in upgrading of their facilities for the handling and management of milk supplies. This is a most depressing situation for small family farmers engaged in milk production. It calls for immediate Government and EU action. I hope that, in the outline he gave recently, the Minister will be able to put in place a scheme which will not force people out of business, as has happened over the past ten years.
