Written Answers Nos. 69-77
69. Deputy Michael Harty asked the Minister for Agriculture, Food and the Marine in view of the Food Wise 2025 targets set for agriculture in the programme for partnership Government and his views on whether these targets are realisable unless urgent remedial action is taken to alleviate the current farming income crisis. [19092/16]
View answerThe agrifood commitments in the Programme for a Partnership Government align closely with Food Wise 2025. My Department has 65 detailed commitments in the Programme for Partnership. The Food Wise strategy for the sector contains detailed recommendations aimed at improving value added and productivity at farm and food industry level through a focus on sustainability, efficiency, knowledge transfer and innovation. If these recommendations are implemented, the expert committee which drew up the Food Wise 2025 Strategy believes that the growth projections are achievable by 2025. Realising these growth projections will be challenging, but I am confident that they can be achieved.
I know that 2016 has been challenging for many farmers. As a small open economy which exports the vast bulk of its food produce, Ireland will always feel the effects of volatility on world markets. However, there are measures in place to help Irish farmers through these periods. Indeed one of the priorities under the Programme for Government is to develop an effective response to price volatility, including through initiatives on access to finance and taxation. Many farmers could also benefit from a sharper focus on financial management, and I was pleased to see the recent ‘Financial Management Initiative’ from the Dairy Forum, providing straightforward advice on cashflow planning, which I hope will be of very practical assistance to dairy farmers.
I have met representatives from SBCI and ISIF in relation to both access to credit and the cost of credit for farmers and SMEs. I have also met with the CEOs of AIB, Bank of Ireland and Ulster Bank. One of my priorities under the Programme for Government will be to support the provision of lower cost and more flexible finance for the sector, and I have conveyed that message strongly to all of the banking institutions.
70. Deputy Bernard J. Durkan asked the Minister for Agriculture, Food and the Marine the extent to which he expects to pursue new markets for Irish beef, lamb, pigmeat, poultry and dairy products over the next five years; if live exports of beef is likely to form a feature of any such strategy; the degree to which he expects Irish farmers to benefit in the short to medium term; and if he will make a statement on the matter. [21321/16]
View answerIrish agrifood exports have increased from less than €8 billion in 2010 to an estimated €10.8 billion in 2015. Dairy exports in 2015 were valued at over €3.2bn and the dairy sector is by a number of measures the country’s largest indigenous industry. 2015 was also a very successful year for meat exports. According to Bord Bia, overall exports of beef, sheepmeat and pigmeat increased by €130 million to €3.2 billion.
The target in Food Wise 2025 is to increase the overall value of agrifood exports by 85% to €19 billion by 2025. Third Country markets are an increasingly important alternative outlet for the industry. The development of new and alternative markets, given the changing global demographics and emerging economies in Asia and elsewhere, is a crucial component of the Food Wise 2025 Strategy.
In the medium and long term global demographics will result in strong global demand for meat and dairy products and my role as Minister is to facilitate market access so that Irish exporters can take advantage of business opportunities as they arise.
My Department engages on an ongoing basis with many third countries, in collaboration with Bord Bia, the Department of Foreign Affairs and Trade, Irish Embassies, the industry and the European Commission on various market access issues. Live cattle exports are an important part of the overall mix and can offer an alternative outlet to farmers for their cattle.
Last week we had further success with the announcement by the US authorities that Ireland has become the first EU Member State to be allowed to export beef for grinding there.
I am acutely aware of the need to develop as many market outlets as possible for Irish meat and dairy products. I will continue to work with stakeholders to raise the profile of the Irish meat and dairy sectors, and the Irish agrifood sector generally, in emerging markets in the Far East, North Africa, the Gulf States and elsewhere.
As an initial step I intend to lead a trade mission to China, Vietnam and Singapore in September to further promote Irish food and drink in the region.
I am acutely aware of the need to continuously develop relationships in new and expanding markets in order to build upon the kind of confidence in Irish production and control systems that provide a platform for long-term trading relationships in the future. I can assure the deputy that the search for new opportunities in both emerging and more mature markets will continue to be a priority.
71. Deputy Charlie McConalogue asked the Minister for Agriculture, Food and the Marine the criteria being considered for the design of a new scheme for sheep farmers under the rural development programme; and if he will make a statement on the matter. [21289/16]
View answerThe new Programme for Government commits to the introduction of a scheme for sheep farmers under the Rural Development Programme with a budget of €25 million to be provided in Budget 2017.
A submission will soon be made to the European Commission in this regard. Any such scheme must meet certain specific criteria laid down by Rural Development Regulation. This scheme, in addition to the existing supports available to sheep farmers under the BPS, GLAS, ANC and TAMS, will make a vital contribution to ensuring the continuing viability of the sheep sector in Ireland.
This commitment is a clear acknowledgement of the contribution the sheepmeat sector makes to the Irish Agri Food economy generating an output value of €320 million in 2015 and supporting 34,000 farm families directly as well as providing several thousand jobs indirectly in rural areas.
As regards the specifics of the scheme design and operation, my Department has engaged in extensive consultation with farm organisations. In addition they met two weeks ago with officials of the European Commission to discuss the proposed new scheme in the context of the specific requirements of the Rural Development Programme.
My officials are currently working on the details of the scheme in light of both the consultation with the farming organisations as well as the discussions with the European Commission. The Scheme is being proposed as an animal welfare scheme based on Article 33 of the Rural Development Regulation. All actions will have to show a clear connection to improving animal welfare conditions for flocks within the scheme.
Schemes under the Rural Development Regulations are required to compensate farmers for actions undertaken on the basis of costs incurred or income foregone. Actions must be verifiable and controllable. They must also must go beyond the normal standards of husbandry practice before they can be considered as an eligible cost incurred by a farmer.
It is my clear intention that this scheme be designed to maximise the number of participants in the scheme and is attractive to all sheep farmers including both lowland and hill farmers.
72. Deputy Bernard J. Durkan asked the Minister for Agriculture, Food and the Marine the extent to which he expects to be in a position to respond favourably to recent submissions from the Irish Farmers Association and other farming organisations with regard to pressing requirements or interventions in the agrifood sector in order to restore viability to the industry and make provisions for the future in the aftermath of Brexit; the degree to which he has had discussions with the European Union, the United Kingdom and all stakeholders in this context; and if he will make a statement on the matter. [21322/16]
View answerI have been working very closely with the farming organisations and with all the relevant stakeholders in the agrifood sector in order to ensure that we deal effectively with the challenges facing the sector. The most immediate of these are, of course, the need to deal with the ongoing market difficulties that have affected the dairy and pigmeat markets in particular, and the new challenges posed by the UK decision to leave the EU.
On the former, I outlined earlier the fact that I have been carefully monitoring developments on the market, and that I have called on the Commission to intervene as required in order to support farmers’ incomes.
The Commission will bring forward a further package of measures at the July Council of Ministers, which takes place next week. At recent Council discussions I have emphasised that our focus must remain on providing real, practical and immediate assistance for farmers, particularly given the additional complications created by the UK decision to leave the EU.
In addition to intervention, I have called for the deployment of other measures that will provide real benefit for farmers in the short-term. These include the bringing forward of the delivery date for direct payments. Last year Member States were also able to pay an advance of 70%, and I have asked the Commission to consider raising this percentage further in 2016. I have also called on the Commission to consider the deployment of a further targeted aid package, similar to that provided last September. This gave considerable flexibility to Member States to adopt responses suited to their national circumstances, and I believe such a measure could play a further important role in 2016. I have also repeated my call for the Commission to help reduce the cost of farm inputs by temporarily removing customs tariffs and anti-dumping duties on the importation of fertilisers.
My approach is underpinned by the need to continue to look at all means of assisting farmers, but in doing so to focus on direct and practical measures, and to avoid taking any action that would in any way compromise the ability of farmers to take advantage of the positive long-term prospects on dairy markets.
I have also taken a very inclusive approach to the challenges presented by the UK decision to leave the EU. I have convened a Consultative Committee of stakeholders - including all of the farming organisations - which met for the first time last week, to ensure a full exchange of information as the negotiations proceed. I am also ensuring that the response of the relevant agencies is fully coordinated through a contact group established under the Food Wise 2025 High Level Implementation Committee.
In addition, I have asked Bord Bia and Enterprise Ireland to provide practical guidance to SMEs. Last week Bord Bia announced a number of measures to support food and drink businesses. These measures cover areas such as managing volatility impacts, providing consumer and market insight, deepening customer engagement and extending market reach, with the aim of helping companies maintain their competitiveness. Similar support is also being provided by Enterprise Ireland.
Aside from currency fluctuations, the main areas in which potential impacts are foreseen are in relation to tariffs and trade, the EU budget, regulations and standards, and customs controls and certification, while complex issues also arise for the fisheries sector.
However, we must remember that our trading relationship with the UK is not altered in any way until the negotiation process that will dictate the terms and conditions of the UK’s departure is completed. This will take some time. In the meantime, my Department will continue to identify the priorities for the Irish agrifood sector with a view to seeking the optimum outcome from the negotiations.
73. Deputy Pat Deering asked the Minister for Agriculture, Food and the Marine the measures he and his Department has taken to address the concerns of the agrifood sector arising from the decision of the UK EU referendum; and if he will make a statement on the matter. [21313/16]
View answerThe decision of the UK to leave the EU is one that creates considerable challenges for the agrifood sector. The UK is by far our largest trading partner. Last year we exported almost €5.1 billion worth of agricultural products. This included more than €1.1 billion in beef products and almost €970 million in dairy products. Ireland is also the UK’s largest destination for its food exports - worth €3.8 billion last year.
This bilateral trade takes place on the basis of harmonised EU rules on animal and public health and labelling, without complex certification, quota limits or customs duties and tariffs. And it is underpinned by the vital support of the CAP budget, to which the UK is a significant net contributor.
Given these linkages, and as the UK is a net food importer, both countries have a strong interest in maintaining a close agrifood trading relationship. In addition, the resilience of the Irish agrifood sector is well recognised, and this, together with the strong commercial relationships built up over years of trading, will help us to negotiate our way though the challenges ahead.
It is important also to bear in mind that the precise implications of the referendum outcome will depend on the trade and other arrangements ultimately negotiated between the EU and the UK. These negotiations may take up to two years, and perhaps longer, and over that period existing arrangements will continue to apply.
Nevertheless, my Department has engaged in detailed contingency planning for the possibility of this result, and has published a summary of the key actions we are taking to address the contingencies arising from the UK’s decision.
The most immediate concerns for exporters centre on Euro-Sterling exchange rates. It should be noted that the fall in the value of Sterling against the Euro, while significant, is not unprecedented. Nevertheless, a sustained period of currency volatility could be of concern. In that regard, the Central Bank of Ireland has pre-established contingency plans to deal with market volatility surrounding the referendum result. The Bank will engage with the Department of Finance and individual financial institutions regarding potential risks. Actions by ECB and other global actors will be monitored closely.
I have also asked the relevant agencies, including Bord Bia and Enterprise Ireland, to provide practical guidance to SMEs. Last week Bord Bia announced a number of measures to support food and drink businesses. These measures cover areas such as managing volatility impacts, providing consumer and market insight, deepening customer engagement and extending market reach, with the aim of helping companies maintain their competitiveness. Similar support is also being provided by Enterprise Ireland.
Aside from currency fluctuations, the main areas in which potential impacts are foreseen are in relation to tariffs and trade, the EU budget, regulations and standards, and customs controls and certification, while complex issues also arise for the fisheries sector.
However, we must remember that our trading relationship with the UK is not altered in any way until the negotiation process that will dictate the terms and conditions of the UK’s departure is completed.
In the meantime, and as part of our overall contingency planning, I have taken a number of measures to ensure a sensible, coherent approach is adopted, namely:
- I have established a dedicated unit in my Department to work on all of the issues that I have mentioned;
- I have convened a Consultative Committee of stakeholders, which met for the first time last week, to ensure a full exchange of information as the negotiations proceed;
- I am also ensuring that the response of the relevant agencies is fully coordinated through a contact group established under the Food Wise 2025 High Level Implementation Committee, and
- The Department will continue to feed into the central Contingency Framework being co-ordinated by the Department of the Taoiseach.
74. Deputy Mattie McGrath asked the Minister for Agriculture, Food and the Marine the measures he is taking to address the income challenges facing hill farmers; and if he will make a statement on the matter. [21004/16]
View answerThe new Programme for Government commits to the introduction of a scheme for sheep farmers under the Rural Development Programme, with a budget of €25 million to be provided in Budget 2017. This will have a positive impact on all sheep farmers including those farming on the hills, where sheep farming is the most common farm enterprise.
This commitment recognises the contribution the sheepmeat sector makes to the Irish Agri Food economy, generating an output value of €320 million and exporting in excess of €230 million in 2015. The sector also makes a vital contribution to the economy, supporting 34,000 farm families directly, in addition to providing several thousand jobs indirectly in rural areas.
I am acutely aware that in spite of these figures that profitability at farm level remains a challenge for all sheep farmers, including hill farmers.
My Department already has in place a number of schemes including the BPS, GLAS, ANC and TAMS which make a vital contribution to ensuring the continuing viability of hill farmers.
In relation to the proposed new sheep scheme, my Department has examined in detail the Rural Development Regulation with a view to formulating a scheme which can have a positive and long term impact on sheep farmers, including those in the hills, and meet the exacting requirements of the Rural Development Regulation.
My Department has also consulted with farm organisations and met two weeks ago with officials of the European Commission to discuss the proposed new scheme in the context of the specific requirements of the Rural Development Programme. Any scheme and actions undertaken within the schemes must be demonstrated to be verifiable and controlled. This will be an area that the Commission will examine in great detail.
I can assure the deputy that I am fully committed to ensuring that this scheme will be of significant benefit to all sheep farmers, including hill farmers.
75. Deputy Richard Boyd Barrett asked the Minister for Agriculture, Food and the Marine the role he believes Coillte Teoranta should have in helping Ireland play its part in achieving targets for CO2 reduction following the Paris climate summit; and if he will make a statement on the matter. [21327/16]
View answerCoillte is the national state forestry company, which was established in 1989, pursuant to the Forestry Act 1988, at which time the bulk of the State’s forest properties were vested in the company. Coillte has developed significantly in the intervening period and currently owns and manages 7% of the country’s land, some 440,000 hectares, the bulk of which is under forest, and it operates three business areas – Coillte Forest, Medite SmartPly and Coillte Enterprise. Each of the three businesses will have a strong role to play in climate change.
The Group’s core forestry business will play a role in mitigating greenhouse gas emissions. The company will continue its programme of reforestation following harvest, thereby contributing to carbon sequestration over the long term. It will also work with my Department in implementing a viable afforestation model. I note from the Coillte Annual Report for 2015 that the company continues to play a key leadership role in delivering renewable energy solutions to industry by providing long term, secure biomass fuel supply contracts to large energy users thorough regional biomass supply hubs. The company’s biomass sales business thereby contributes to decarbonising the Irish economy by providing a sustainable and natural substitute for fossil fuels. The company is also active in other renewable areas which will contribute to renewable energy targets with the company’s land solutions business on track to deliver electricity to over 300,000 homes by 2017.
Medite SmartPly, Coillte’s panels manufacturing business, as one of the largest users of power in the country, has an important responsibility to reduce its reliance on traditional energy sources. Wood-based panels as used in the built environment and elsewhere are an important carbon store in their own right.
Coillte advise that it will take a leadership position in shaping policy around the role forestry will play in climate change and will be at the forefront of global and European developments. An example of the company assuming a leadership role in this area was its hosting of the Climate Change and Irish Forestry Conference in Farmleigh House in Dublin earlier this year, on 29 February, 2016. The conference brought together representatives to address the risks and opportunities that climate change and its mitigation presents to the Irish forest sector.
76. Deputy Ruth Coppinger asked the Minister for Agriculture, Food and the Marine to report on all meetings and contacts he and his officials have had with counterparts in other European Union member states regarding the export of greyhounds to the Macau Special Administrative Region, China; and if he will make a statement on the matter. [21136/16]
View answerNeither I nor my officials have had meetings or contacts with counterparts from other European Union Member States in this matter.
I understand that this trade has ceased and I am confident that the advice being offered by Bord na gCon to owners involved in the export of greyhounds to only export to destinations with high animal welfare standards is now being acceded to and the imposition of a ban in this area is not warranted.
77. Deputy Charlie McConalogue asked the Minister for Agriculture, Food and the Marine when farmers will be able to avail of affordable loan credit from domestic and European Union funding sources in order to bridge liquidity gaps; and if he will make a statement on the matter. [21288/16]
View answerI am fully aware of the pressures on farmers right now, and I have committed to working with all the stakeholders, both at national and EU level, to address these issues and ensure that we continue to have a sustainable and resilient sector. One of my priorities is to support the provision of lower-cost, more flexible finance.
The EU Commission has announced some limited flexibility on State aid provisions as part of the response to price volatility, including the possibility of a measure on bridging liquidity gaps. I should point out that this flexibility does not include the provision of EU funding. I am working with all the financial institutions, particularly the Strategic Banking Corporation of Ireland (SBCI), to identify potential solutions to providing working capital finance for farmers with liquidity issues.
I recently met with the CEOs of the main banks and stressed the need for them to be flexible in the context of increased income volatility. The banks told me that they recognise and are responding to the challenges facing farmers in this regard. They all offer options such as moving loans to interest-only repayments and extending overdraft facilities. They all stated that they are committed to the sector for the long term and are aware its cyclical nature. I also took the opportunity to question the banks on the relatively high interest rates for SMEs in Ireland compared with those across Europe.
Partly in response to these relatively high interest rates, my Department has just published a request for tender to procure an ex-ante assessment to assess any current failures in the access to finance market in Ireland. This is a first step towards the potential introduction of Financial Instruments under the EAFRD Rural Development Programme and the EMFF Seafood Development Operational Programme.
Access to finance was discussed at the Dairy Forum in June, with an exchange of views with the main banks now a part of the agenda at each meeting. Before the meeting I formally launched the Dairy Forum’s ’Financial Management Initiative’, a programme of cash flow and financial management training and advice for dairy farmers, which is an appropriate and practical initiative at this time.
Access to finance was also discussed at last month’s meeting of the Food Wise 2025 High Level Implementation Committee, which heard from representatives of the SBCI and the Irish Strategic Investment Fund (ISIF). Both are now active in the market. In its last report in January, the SBCI stated that of the 4,619 loans amounting to €172 million drawn down by SMEs, 26% had been accessed by agriculture, which is currently its largest sector.
My Department, in cooperation with all the other relevant State bodies, will continue to explore additional funding mechanisms for farmers, the agrifood sector and for SMEs generally.
