Agricultural Produce (Fresh Meat) Act, 1930 (Exporter's Licences) (Fees) (Amendment) Regulations, 1986, and Pigs and Bacon Act, 1935, Regulations, 1986: Motion.

Minister of State at the Department of Agriculture (Mr. Hegarty)

I move:

That Dáil Éireann approves the following Regulations in draft:

Agricultural Produce (Fresh Meat) Act, 1930 (Exporter's Licences) (Fees) (Amendment) Regulations, 1986, and Pigs and Bacon Act, 1935 (Part II) (No. 12) Regulations, 1986, copies of which were laid in draft before the Dáil on the 13th day of November, 1986.

These regulations would temporarily reduce from 75p to 50p the fees payable in respect of pigs presented for veterinary inspection under the Pigs and Bacon Acts and the Fresh Meat Acts. Subject to the approval of the House, I would hope to have these reduced fees made effective in the period from 1 July 1986 until the implementation of proposed legislation on local slaughterhouses but, in any event, not later than 30 June 1987. The slaughterhouse legislation referred to is aimed at harmonising inspection standards and charges as between domestic pork and other slaughterhouses and export plants, thereby removing competitive anomolies between both types of premises. I hope to have the necessary draft Bill introduced in the near future.

The matter of veterinary inspection fees on pigs has for some time now been a matter of concern for my Department. This fee is a statutory charge for a service provided by my Department's staff at approved export pig slaughtering plants. Between 1982 and 1985 the majority of curers had been refusing to pay these fees, resulting in arrears of almost £5 million being built up in that period. The reasons given by the plants for their nonpayment were, first, that they claimed the fees were too high and, secondly, that they suffered a competitive disadvantage on the home market since domestic slaughterers were not subject to the same inspection charges and standards. Following lengthy negotiations between my Department and the Irish Bacon Curers Society Limited, last year and mindful of the market difficulties being experienced by the industry, I agreed to a reduction of the fees from their then level of £1.10 to 75p per pig and also to update legislation on domestic slaughterhouses. The pigmeat plants, for their part, agreed to commence payment of the new fees. I am sorry to have to report that following an initial resumption of fee payment the majority of curers have now once again discounted payment, leaving an amount of £ 1.3 million outstanding since April 1985.

I appreciate that the pigmeat industry has been going through a difficult time. Increasing competition being experienced on home and export markets has lead to severe cash flow problems for many firms. Many other industries in our economy are, however, facing similar problems, but they are facing up to their obligations. So must the pigmeat industry.

Deputies will, I think, appreciate that the reduction I am now proposing which, coupled with the previous reduction, amounts to a total reduction of over 50 per cent since April 1985, represents a very significant gesture on my part. However, I can go no further than this. The amount charged falls far short of the cost of the service provided. The industry must now act responsibly and honour its agreement on this matter. Hopefully, it will do so voluntarily. I must now indicate very clearly, however, that if it does not do so I will have no hesitation in taking very firm action against defaulters, action which could result in firms losing their export licences.

In an attempt to help the industry in its present difficulties, I have already taken a number of initiatives designed to alleviate problems. These include the extension to pig producers of the scope of the recent exchange rate guarantee scheme for short term working capital for farmers and, indeed, the lifting of the ceiling to £50,000 for pig producers. The proposal by the EC Commission to extend to the rest of the country the 50 per cent FEOGA grants currently available to pigmeat projects in the disadvantaged areas — at present the rate of grant is 25 per cent outside disadvantaged areas — will also help. I have already mentioned the planned legislation on domestic slaughterhouses. The proposed reduction in fees, now before the House, is a further and indeed very tangible measure of aid.

The pigmeat industry must now get on with the job of tackling its major structural and organisational weakness if it is to face the future with confidence. I have for some time been emphasising the need for rationalisation of pig slaughtering plants and modernisation of processing premises. While there are some hopeful signs of developments on this front, much more needs to be done. Generous grant aid is available to suitable applicants for this purpose. If firms can modernise their plants to the highest standards, new markets will be open to them, for example, the US market from which they are presently excluded. Firms also need to place much more emphasis on developing their range of products and marketing them agressively. Product quality and consistency are, of course, also very important if we are to compete effectively. In recognition of this, my Department are working towards having the recently agreed EC pig grading scheme introduced here as soon as possible.

I hope that all sides of the House will support the draft regulations and also support me in calling on all those involved in the pigmeat sector to tackle the urgent tasks now facing the industry so as to ensure it retains its valuable place in the Irish economy in the years ahead.

I should like to welcome the recent developments in the north west and in the south in regard to FEOGA applications. At long last our co-operatives are moving towards expansion and I hope that expansion which we all welcome will take place in the not too distant future.

Mr. Noonan

(Limerick West): I should like to support the Minister's call on those involved in the pigmeat sector to tackle the urgent tasks now facing the industry so as to ensure that it retains its valuable place in the Irish economy in the years ahead. The Minister has the full support of our party in his efforts in regard to that. There should be more positive action from the Department and there is a need for the pig industry to be given leadership. I agree that the industry must face up to its responsibilities but the Minister, and his Department, must ensure that the industry is helped in every way. In the course of my contribution I intend to suggest ways the Minister and the industry can live up to their responsibilities. The Minister told us that the pigmeat plants agreed to commence payment of the new fees and added that he was sorry to have to report that following an initial resumption of fee payment the majority of curers have now once again discontinued payment, leaving an amount of £1.3 million outstanding since April 1985. I hope the Minister will tell us how this has arisen. What action does he intend taking to ensure that there will be a resumption of the payment of fees? It may be that this has arisen because, as the Minister said, legislation is needed to modernise the pig industry with particular emphasis on slaughtering. I hope the Minister will deal with that point in his reply.

I appreeciate the contribution by the Minister, and the Department, in helping the industry in this difficult period. The Minister said:

It was a significant gesture. The Minister added that the industry must now act responsibly and honour its agreement on this matter. He hoped it would be done voluntarily. He said that he will have no hesitation in taking very firm action against defaulters, action which could result in firms losing their export licences.

The Minister should spell out clearly what action he has in mind to deal with defaulters. Will the Minister say if the whole industry is in default or if we are concerned with the majority of those in it? Is there a concerted effort by the industry not to make a contribution? If that is the case how will the Minister deal with those defaulters? How many are involved? I accept that the extension to pig producers of the scope of the recent exchange rate guarantee scheme for short term working capital for farmers and, indeed, the lifting of the ceiling £50,000 for pig producers goes some way to relieving the position but it is not sufficient. I should like to commend the Minister on negotiating the extension to the rest of the country of the 50 per cent FEOGA grants currently available to pigmeat projects in the disadvantaged areas. The Minister, and the Department, deserve our praise for negotiating that deal.

The necessary financial incentives are now available but one must ask why they have not proved attractive enough to the industry. Some weeks ago I pointed out to the Minister that a Limerick processing firm had to import bacon from Denmark in order to meet an export commitment to the USA because we do not have a processing plant that is up to the standards of the US Department of Agriculture. That is a sad reflection on our industry. We need leadership in that area from the Minister and his Department.

Time and again the Minister told us of the planned legislation on domestic slaughterhouses. We have heard about this many times. Is the delay caused by a legal problem or is it a lack of willingness on the part of the Department to bring slaughterhouse legislation up to date? How seen can we expect this legislation?

I expect that if firms modernise their plants to a higher standard new markets will be open to them. The US market is closed to us at the moment because our processing plants are not up to the standard required by the Department of Agriculture in the United States. Firms need to place more emphasis on developing their range of products and marketing them aggressively. There is little point in having a good product unless we are in a position to market it.

There is also a need to meet the changing demands of the consumer. In this area we have fallen down very badly. Product quality and consistency are important if we are to compete effectively. I hope the Department are working towards having the recently agreed EC pig grading scheme introduced here as soon as possible. This will certainly help the industry and the effectiveness of the product on the domestic and export markets. How soon can we expect to have this scheme implemented?

While the aids the Minister has given are welcome, they are all very small, although together they can be recognised as something tangible. But in addition we need a pig grading scheme and perhaps the Minister would outline what is involved, what it will mean to the producer and what it will contribute to our competitiveness in the market.

I am happy to have the opportunity to agree to this resolution now before the House. We would welcome the speedy implementation of these new regulations. The reduced rate of fees for veterinary examinations will be at the rate of 50p per pig, and will be effective from 1 July this year and will continue until the end of July 1987.

The pig industry has been going through a very difficult period in recent times. The scheme now proposed will give some relief to the industry and to the factories processing the pigs. It is important that this relief is passed on to the producer, as the Minister intends, because this area is badly hit at present. As the relief is effective since the beginning of July there should be a build up of a small reserve to enable processing factories to encourage processors at home on whom they depend for their raw material.

The pig industry has been going through a bad time, particularly at producer level. The processing sector have also experienced some serious difficulties. Here I join with the Minister in congratulating everybody concerned in the rationalisation of the industry in the west. This is a step in the right direction. I hope the project will be a huge success and that it will be copied throughout the country.

The pig industry must be built up. Pig rearing has changed remarkably since we joined the EC. The small sow units of the past have been replaced by very large and specialised rearing units. Practically the whole of the pig rearing industry is now concentrated in the hands of a very small number of producers who have made very heavy investments in their business. This is all the more reason the industry should get special attention from the Department.

We are also at a disadvantage here in that feed costs for pigs tend to be higher than elsewhere. This impedes the competitiveness of the industry and our ability not only to maintain supplies for the home market but, above all, to increase our export trade.

We must look very carefully at the pig processing industry. Our pig producers have deservedly got a reputation, in recent years, for being very efficient. Unfortunately developments in the processing sector have fallen very far behind. I do not at this stage wish to analyse why this is so except to say that a certain artificiality was maintained in that sector for some years and that did not help the industry. That artificiality cost the taxpayers some millions of pounds a few years ago in connection with the Pigs and Bacon Commission, but that is post, over and done with and we hope there will be no repetition of it.

There is now great and urgent need for the retionalisation of the industry and for the building as soon as possible of a small number of factories which will be up to international standards. The Minister in reply to a parliamentary question I put to him in the past week said there was some hope of progress. I encourage the Minister and the industry to do everything possible to speed up that progress.

One could say that the pigmeat industry here is at risk. We must face up to that fact. We all know that about four fifths or more of the output is sold on the home market. There is as yet no great evidence of imports making inroads but indeed it would be a sad day for the whole industry if that should begin to happen. Therefore, the quality of the finished product for the consumer is all-important. We have been for four or five years a very prominent food display centre in the centre of the city of Dublin using certain quantities of pigmeat imported from the northern part of this country.

As with all other agricultural products, everybody from the producer to the processor must keep the ultimate consumer. in mind. I am not going to deviate into the milk industry, but let me give as an example the fact that in the past year or so we had in the milk industry evidence of the power of the consumer within our country. The Minister knows well that there has been a remarkable change in the amount of butter consumed on the domestic market. There has been a fall of some 20 or 25 per cent in that regard in the past 12 months, and the Minister knows that the gap has been filled by spreads which, unfortunately, use a considerable amount of imported raw material. I give this example to outline and indicate the power of the consumer and how necessary it is for concerns processing agricultural products to keep the interest of the consumer in mind. I would be very concerned indeed if imports began to take over any part of our markets. Already we have far too many imported foodstuffs of various kinds. A few years ago we began to depend on imports for a considerable portion of our flour for bread making. We had large imports of potatoes, mainly in the form of frozen chips, carrying in some cases brand names indicating that they have some Irish connection which, of course, we all know they have not. All of this is very worrying, especially when one thinks of the amount of foreign exchange which must have been spent on these imports and above all the amount of employment which is being lost to the country.

In the pigmeat industry income generated through agricultural production here and through the processing of that production can do nothing but benefit the economy. No black hole in our economy can be created by agriculture. This is a message which, with great emphasis, I would like to place firmly on the record of this House.

I was somewhat upset in recent times when I learned from a food processing concern in my county of Limerick that they were unable to find within our country pigmeat suitable for export to the US market. The food processing concern in question, which I have visited and inspected, has built up very good contacts and has the possibility of exporting to the US but find that we have not one pigmeat processing factory acceptable to the US Department of Agriculture. What are we going to do about it? What are the plans in the Department of Agriculture to remedy that? Must we continue to import bacon from another country in order to meet the market commitments of this firm and their export trade to the US?

The Minister in his reply to the question I have just referred to stated that perhaps in the next year this deficiency will be made up. That is a ray of hope. He might outline and elucidate in detail where he can see this ray of hope developing. It would be very welcome news particularly to the industry. I hope that the Minister in his reply will allay any fears there may be about this and that this firm in my county will have the opportunity of using bacon produced and processed in this country, from animals slaughtered here, in some of the modern factories we hope will be built. Maybe that is where the Minister sees the ray of hope, so I ask him to outline more clearly what he has in mind.

A country which falls down in maintaining a high standard for its exports leaves itself wide open to imports, and again I emphasise the importance of having regard to the consumer. The consumer is all important. Maybe in the pigmeat industry as with other agricultural products we do not take into consideration the changing needs of the consumer. We should recognise that consumer needs change daily and that we are not producing the product required. Research and development is needed in this area. I appeal to An Foras Talúntais to initiate that research and I hope there will be no further cutbacks in funding to An Foras Talúntais.

The cost of foodstuffs is a problem in pig production. There have been substantial benefits to the industry recenty from the milk sector but the milk sector is now facing major difficulties and there is a crisis in that area. The Minister should do his utmost to ensure that the benefit, to pig producers from the dairy sector are maintained. We should ensure that we have a high quality product from pig production to meet the needs of consumers. Along with investment in new processing. Machinery form pigmeat the IDA and the Department of Agriculture should ensure that factories who benefit from the grants are marketing their products properly so as to provide the home market with a high class product and to supply the export trade. Our marketing of pigmeat in Britain has not been as good as it should have been. Irish bacon was constantly discribed on the British market by comparison with Danish bacon and the artificiality to which I referred a few minutes ago had this something to do with that. I hope this will never happen again. We should turn out a first class product capable of competing with the best. At the moment some producers seem to have possibilities, through better management, of reducing costs in pig production. In the processing sector there is a scope for improvement as there is in the marketing sector. The industry has a good future but it is up to the people involved to make the fortune that can be made from pig production. The State can help and the motion before us is evidence of that but greater that the IDA and FEOGA grants are the efforts of the people in the industry. I welcome the motion and I wish the industry the success it deserves. This is a traditional industry which has provided worthwhile income to the members of the farming community down through the years. Now there are changes in pig production, from the smaller to the bigger units, but the industry can be further developed so as to produce a better quality product for the consumer. This motion helps in some small way towards that end.

Mr. J. Leonard

I welcome the reduction. These levies have come in for a lot of discussion over the last year in my area as we had two factories in difficulties where 100 people were out of work for some months. At that time we compared the levies here with the levies on our competitors.

I pay tribute to those two industries who are now going full steam ahead and who hope to extend their workforce. We are very often critical of governmental Departments, but on this occasion I congratulate the Department for their efforts to ensure that these two factories went back into production. In any other constituency where there were 100 people out of work there would have been a scuttle for redundancy payments but these people are back at work and the factory is in full production. Credit is due to them. Until these factories came into production we had been producing almost entirely for the domestic market but one of those factories exported 95 per cent of its product. It was regrettable over the years that we did not move into the export markets because if you do not sell aggressively you will not continue in business. Those factories exported 95 per cent of their produce on the Japanese market.

Many producers here have the capacity to make an impact on the American market. The Minister said that legislation in regard to slaughtering is aimed at harmonising inspection standards and charges between domestic pork and other slaughterhouses and export plants, thereby removing the competitive anomalies. Certainly those anomalies were very serious and the reason for so much frustration and apathy in the industry. Some people were operating within very rigid guidelines while others were not.

We cannot over-emphasise the importance of pig production and, fortunately, rationalisation will solve the problems in western slaughtering and processing plants. Pig production played a very important role in small farming. In my constituency, before the war and immediately after 50 per cent of farmers were producing pigs and were totally dependent on that line of production. That has now changed greatly — there are about 100 producers in County Monaghan at present — but there are compensations because of the number of jobs provided in slaughtering and processing plants. Value added products have been mentioned, an area in which there is room for major development. It is accepted that pork meat is a very good product.

A German factory in Monaghan has gone into production and the base for their food is pigmeat. It would be a great pity if the industry suffered any setbacks. We should be in a position to compete with the US market. It is unfortunate that a firm here purchase products outside the country to fulfil their contracts in the US. Over the last few years, the exchange rate was fairly favourable and we could have taken advantage of it to produce products which would have sold well over there.

There has been great development in pig breeding and in the feeding system. We can compete with any EC country so far as production is concerned. Imports have been mentioned. At the end of last year we were allowed to import pork and bacon products. Serious fears were expressed in that regard but, thankfully, there have not been any serious repercussions. Commonsense prevailed and many producers stayed with the home produced article. The customer is very important and good quality products will always sell. For a long time we depended on the Japanese market although we knew that it would not last forever. It was accepted that if we were in a position to meet the strict American standards in relation to processing we would capture that market.

We welcome the exchange rate guarantee scheme which raises the ceiling to £50 for pig producers. The Minister said that the pig industry must now get on with the job of tackling the major structural organisational weaknesses if they are to survive. That area must be tackled without delay. If structural weaknesses are faced we will be in a position to benefit because there is a great input from other areas. If pig production failed it would be a very serious matter.

There has been talk of reducing acreage in regard to cereal production. Now that there are problems in beef production we will be depending more and more on cereals to be utilised for pigfeed. There is certainly an opportunity for an increase in this area as it has been the backbone of the small farmer in the Connacht-Ulster area over the years. While they are not directly involved now, as I said, in the production end, the job potential is there, for example, in producing pigmeat and processing the product. Pigmeat is ideal for processing. It compares with the broiler and the turkey. On almost a daily basis new products are being developed and they are being utilised in other areas such as prepared foods, cooked foods and so on.

The future for this country lies in producing a quality article. The first step is to get to grips with the American market, and we now have the opportunity to do so. The public look for quality and will pay an additional price for it. There are opportunities in the European market for pigmeat and other products. I welcome the reduction and I ask the Minister to bring in regulations with all possible haste with regard to slaughterhouses and to impress on the various slaughterhouses the need to have their premises in a position from which they will be able to compete in all available markets.

Mr. Wilson

It is particularly appropriate for a representative from my county and constituency to talk on draft regulations reducing fees on pigs being slaughtered at pork and bacon factories. The House knows very well that in many areas of the country, particularly in my own county, the economy for many decades stretching back into the 19th century has to a great extent depended on small farmer production of pigs and pigmeat. We have an indigenous industry in the county which has been established for a long time. McCarron & Co. Limited are one such firm. They still represent direct employment in our county town. In political clinics in that town I have had occasion to reflect on how important the factory is for the town and the great disaster it would be if it could not be sustained as a profitable processing factory.

I have strong views about the products and about the way in which the industry has been going. I would like to make a few suggestions while speaking on these draft regulations. The industry has changed to a great extent, and Deputy Leonard referred to this. We have reached the era of large production units. I am not saying the hands of the clock should be put back but it is a considerable wrench to our local economy. There is a tendency in most places, as exemplified for example in the corner shop making way for the big supermarket, to concentrate on larger units nowadays. I have no doubt that the wheel will come full circle in many areas of the economy, be they the supermarket or factory areas, when people will begin to reflect on other economic factors other than the economy of scale. In my own constituency many small farmers still breed bonhams and sell them either to larger fattening units or to individuals who want to fatten them from the eight to ten-week old stage onwards. That was the old method. Due to certain trends and tendencies in farming and in the production of food which are apparent at present that small scale effort — admittedly it will have to be at a premium price — will be able to make a comeback. I refer in particular to the big drive for natural foods and organically grown foods. This transfers to certain types of livestock and, in particular, it would transfer to the pork and bacon area.

I do not think it would be successful if it were simply the small farmer producing pork and bacon using the methods of the big farmer. There is a future if, for example, the small unit rely on their own barley to feed a small number of pigs. This will reflect on the quality of the product. I have no doubt at all about that. I remember saying years ago when mass production of eggs was beginning to develop that the time would come when the children of the country would not know the real taste of an egg. Admittedly, the big battalions will come down on top of me for talking like this but that egg cannot compare in flavour with the free range egg. There is a market and there will be a developed market for pig and pork products in the future.

The Minister stated in his speech that he is introducing this reduction to operate from 1 July 1986 to not later than 30 June 1987. In so far as it is a help to pig producers I would like to support him. I do not know what kind of impact it will have and how much of a help it will be but I know that people who are producing pigs in my own county and to whom I have spoken recently are saying that the profit margins are exceptionally low and, consequently, the business is in a perilous state. I hope the margins will improve and that the producers, whether on a large or small scale, will be able to survive. To go to another point, from the point of view of value for money in the shop, pork has been for a considerable period away ahead of anything else that is being offered to the housewife. She can obtain for her money an amount of pork which is larger than she can get for the same money in beef and, especially, lamb. As the House knows, pork is a very fine food. I would like the position to be maintained where a reasonable margin could be achieved by the producer and in the market the same kind of good value would be available to the housewife.

There has been controversy and difficulty in my own area with regard to the factories and the rationalisation programme which is under way. This would cover a large area of production, partly in the west and partly in south Ulster or the north midlands. I am sure the Minister has the interests of the industry at heart. In his part of County Cork productivity is not as great as in south west Cork. West Limerick was traditionally an area where this industry flourished. I lived in Donegal for a number of years and there they never went in very much for breeding. They went to other areas, particularly to my native county, to purchase at the bonham stage for fattening. I am afraid to use the word "fattening" nowadays for fear of doing damage to the industry. It is a dirty word in those areas.

Unfortunately I did not get here in time for the Minister's speech and the debate. I am sure the House will support whatever measures are to be taken to sustain the pork and bacon industry. We in Fianna Fáil, led by our spokesman, are putting together a policy in this regard.

Minister of State at the Department of Agriculture (Mr. Hegarty)

I thank Deputies for their helpful contributions. Of course the Department will help, as they have always done, to meet the challenges. The Department of Agriculture have always done so within acceptable limits. The bacon industry must lead, not the Department. The industry must go out and market pig meat products.

We have reduced the fees to about half the 1985 level. Our inspection fees are now among the lowest in the EC. The pig fee is much more favourable than the fees for cattle and sheep. Rather than spell out in detail what we have in mind, I would hope that the industry would heed my general warning. They must pay fees like the cattle and sheep farmers. We cannot continue as we are.

Mr. Noonan

(Limerick West): I hope that is not a threat.

Mr. Hegarty

The service costs a lot more than we take in. Nearly all the factories are in default, which seems to suggest concerted action. That is not good enough. They have made the point that when we get our act together with regard to slaughtering we will have a different ball game. I said earlier that the legislation is practically ready and will be implemented forthwith. Then they will not be able to make the same excuse that they are in an unfair position vis-á-vis other sectors of the industry.

Mr. Noonan

(Limerick West): The Minister will not do anything until the legislation is published.

Mr. Hegarty

We will have it fairly quickly.

Mr. Wilson

I do not think the United States can produce slices of bacon like ours.

Mr. Hegarty

We must raise our standards to get into the US and other valuable markets. A number of prospects are in the pipeline and we expect significant developments in the next year. I expect the people Deputy Noonan was worried about would be in a position within the next year to get the type of meat suitable for the US market from people like Galtee.

On the domestic slaughterhouse legislation, we are on the verge of bringing this before the Dáil. On pig grading, we are not obliged to bring in EC legislation before 1988. We are urging the industry to take it very seriously and I am hoping we will have the legislation a year in advance of schedule. It is vital that the industry should move swiftly. Grading is based on lean meat content, which is what the consumer wants. There is no point in producing anything else. For far too long producers of all kinds have been producing things in the hope that the consumer would buy.

Mr. Wilson

I agree, but in the United States they go in for second grade streaky bacon.

Mr. Hegarty

Fair enough, if that is what they want. For far too long we have not been taking sufficient note of the market place. Our top people in the bacon industry are going into the supermarkets and talking to people there to find out what the consumer is looking for. This is taking the job of producing seriously.

Mr. Noonan

(Limerick West): Not before time.

Mr. Hegarty

We are doing a fair bit for the industry within the existing constraints. There is sufficient encouragement of all sorts and it is up to the industry to avail of the generous grants and other aids available. Substantial FEOGA and IDA grants are available and I would urge people to avail of them. The producer in this instance is certainly playing his part. He has modernised and for once we cannot point the finger of blame at him. It is also important for the industry to realise that it cannot be all give on one side and take on the other. The industry must pay the charges legally levied on them. These charges are reasonable and this cannot be denied. The industry must face up to their legal responsibilities.

The best defence against imports is to get our own standards up and ensure that we operate efficiently. In other words, we beat exporters at their own game. This can be done given the required commitment, and we have that commitment, through slaughtering to production and marketing.

The processor referred to by Deputy Noonan will be going into the United States market before mid-1987 and I hope we will have the necessary raw materials in time. The Government are fully behind that project. The skim milk subsidy was also referred to. This confers substantial benefit on the pig producer. I can assure the Deputy we will continue to press the EC to continue that subsidy because it alleviates some of the disadvantages involved in this area as well as the high cost of feed.

I want to refer briefly to the speech made by Deputy Leonard. I am delighted that Grahams of Monaghan are back in full production. This business is almost entirely export oriented and I hope they go from strength to strength. It is a matter of regret that we have been unable to avail of all the opportunities in the United States market in the recent past, but the important thing is that we avail of any opportunities that arise in the future. The Deputy rightly stressed the need for diversification in products and in markets because that is the securest way forward.

He also referred to the purity of our food. This is an advantage we do not make enough of. We have a wonderful climate and we are free of acid rain. In this modern age when there is so much emphasis on health foods, we do not lay enough emphasis on the fact that as an island we are pollution free. Our meat is particularly good, free of hormones and so on.

Deputy Wilson referred to the change from small to large scale units. There are some disadvantages to this but the large units have an overriding advantage. I know from experience that the large units have brought a measure of stability to the pig industry. There is nothing wrong with small units because the small producer can fill a niche in the market by supplying a specific product. One of the main problems in the past was that people in the pig industry in a small way could move in and out very easily, and there were massive fluctuations. Most of the people involved in pig production nowadays are involved in a very big way and cannot move in and out of the market quickly. Big is not always bad.

Dáil Éireann díospóireacht - Tuesday, 25 Nov 1986