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Dáil Éireann díospóireacht -
Wednesday, 6 Mar 1996

Vol. 462 No. 6

Adjournment Debate. - Crisis in Pig Industry.

I wish to share my time with Deputy Brendan Smith.

Is that agreed? Agreed.

This is a sad day for the pig industry in Cavan-Monaghan. As I speak the 9 o'clock news is probably showing a report on the closure of the Cavan slaughter plant. That factory may never be reopened and the 90 employees — one man has not been out of work for 44 years — will end up on the dole. Counties Cavan and Monaghan have a history in pig production and many producers modernised their farmyard enterprises by installing large computerised feeding units. Employment is now centred in the slaughtering plants and on value added products. My colleague will deal in more detail with the Cavan plant as he is more familiar with it.

While the problem in Monaghan is similar, it is of a different dimension. When the Graham factory was reopened the workers were employed as subcontractors — they were not members of SIPTU. The price of pigs increased from 95p a kilo 12 months ago to £1.40 a kilo a few weeks ago — I think there has been a slight reduction since then. There has been a reduction in supply and an increase in the demand for the products. A British firm which recently took over a Northern Ireland plant has increased the weekly slaughter throughput from 3,000 to 8,000. This increase was picked up by southern farmers because there was no taxation control or any other type of control. Not so long ago we asked the electorate to vote in favour of a Single Market of 300 million people. As we now see, jobs can be snatched from under people's noses. I would like to know how fair this competition is. If the company in Belfast continues in operation it will soon have a monopoly and cause serious problems in the industry.

If this problem arose in any other part of the country there would be an outcry, Ministers would make promises and the IDA and Forbairt would seek alternative employment. However, there has been no word about the problem in Cavan-Monaghan. The Minister refused to meet SIPTU, did not meet his counterpart in England, did nothing at EU level and has not met the producers.

I met SIPTU.

There is little point in the Minister saying live horse and you will get grass. Last week he said no tears would be shed if Larry Goodman withdrew from the beef industry. The workers in this industry would shed few tears if he resigned as Minister.

I thank Deputy Leonard for sharing his time with me. I was very disappointed at the reply given by the Minister yesterday to parliamentary questions tabled by Deputy Leonard and me on the crisis in pig processing plants and, in particular, the plight of the workers at McCarren and Company Limited, Bacon Curers, in Cavan who have been let go. The final sentence of the Minister's reply stated: "The outlook for the industry is good and, as indicated, supplies are expected to become more plentiful in the latter part of the year". Nothing in his reply conveyed any urgency in tackling the problems experienced by the pigmeat industry in recent weeks, problems which have resulted in the closure of McCarren and Company Limited in Cavan with a loss of approximately 100 jobs.

McCarren and Company Limited, which was established in 1860, was a very good employer, providing gainful employment for generations of Cavan families. Its products were first class and it had markets at home, in Britain, Europe and North America. I am very disappointed that the workers have been laid off as they were committed to earning an income and most of them have mortgages and family commitments. They are very disappointed that no action has been taken by the Minister to deal with this crisis. McCarren's not only provided gainful employment in Cavan but it was also an important processing outlet for primary producers in the county and neighbouring areas. Pig farming constitutes a major segment of the farming industry in County Cavan, with a 36 per cent increase in pig numbers between 1980-91. The main manufacturing sector is the food sector which employs approximately 1,300 people, representing 35 per cent of total manufacturing.

I understand that the Minister, Deputy Yates, did not accede to a request by SIPTU at national level for a meeting to discuss this crisis. The Minister of State, Deputy Deenihan, met with SIPTU because of the crisis in Tralee in his constituency. If the Minister finds it difficult to provide specific assistance for the pig processing industry then he should take the initiative and meet with the representatives of the primary producers, the unions and the pig processing plants. The long-term future of the pigmeat industry is in question. The primary producers, the workers in the plants and the processing industry need a Minister who will take responsibility and give the lead at this difficult time.

The making of announcements when there is good news is not sufficient for any industry. The Minister has shirked his responsibility to make every possible effort to save jobs in this long-standing industry and to formulate a co-ordinated plan which will deal with the cyclical problems which affect it.

Is it in order for me to give one minute of my time to Deputy O'Keeffe?

The Minister has created a precedent by giving an Opposition Deputy some of his time. However, he is aware of my involvement in the industry. This problem has been created by the purchase of a large plant in the North by a multinational company which is buying pigs from southern suppliers, thereby creating a substantial shortfall here. As Deputy Gallagher said, the problems in this industry are of a cyclical nature and there is a shortfall in supply at present.

Under various Ministers for Agriculture, for example, Deputies Deasy and Walsh and Senator Kennedy, the industry was developed to the stage where there were 3.5 million pigs. The modern trend is to have large processing plants and grant aid has been given for this purpose. One of the finest processing plants is located in Tralee in the Minister of State's constituency. However, this plant also has a shortfall. I do not know how the problems can be overcome given that this cash rich British firm is buying pigs at exorbitant prices. I am concerned that there could be a contraction in the industry and a reduction in pig numbers from 3.5 million to 3 million. Given the high costs of processing, a large-scale operation is the way ahead in the industry. In the UK, Holland and Denmark an average of 15,000 pigs are slaughtered every week.

We have to look to developing a modern, efficient industry. I hope the Minister will recognise the problems the industry is facing caused by the scale of the operation in the north with the involvement of a UK company, and create greater incentives to southern producers to overcome the difficulty.

I remind Deputy Leonard that I met SIPTU, as acknowledged by Deputy Brendan Smith. I assure this House I am concerned about the difficulties being experienced in the pig industry. If proof is needed to demonstrate our concern for the pig industry, I ask Deputies to recall the early months of 1995, just after the Minister and I came into office, when pig prices were very low and producers were suffering substantial losses. We set about introducing a number of measures aimed at restoring profitability to pig producers. We achieved that aim mainly by reducing the veterinary inspection charges and other levies due on pigs at slaughter. Pig prices rose to a satisfactory level and balance was restored to the market.

However, the price of pigs has risen substantially since the beginning of this year, and this has created difficulties for the processing side of the industry. Slaughtering plants particularly in the Border regions are finding it difficult to obtain supplies of pigs because of the high prices which they have to pay. Unfortunately, one such plant, McCarrens of Cavan, temporarily closed its premises last week, for a period of three months, and some 100 employees have been laid off. The firm indicated that it cannot afford to pay the high prices being sought for pigs at the moment. My Department contacted Forbairt about this firm and has been informed by Forbairt that detailed discussions are ongoing with the company to see how the problems can be overcome. In that regard Forbairt has offered its full services to the firm.

A number of factors are influencing the price of pigs at the moment. As is well known, the pig industry is by its nature cyclical, which means that pig numbers fluctuate from time to time thus creating shortages or oversupplies. I am pleased to say that the December 1995 CSO livestock survey shows that pig numbers in Ireland have risen by 2.9 per cent on the figure for December 1994, standing at 1,542,000 compared to 1,498,000. We can therefore look forward to supplies becoming more plentiful in the latter part of this year, as it will take some months before the increased number of pigs will be ready for slaughter.

The arrival of a major pigmeat processing firm in Northern Ireland towards the end of last year is another large factor which has led to the shortage of pig supplies in the south. This new Northern Ireland firm is sourcing some of its supplies south of the Border and is offering higher prices for the raw material than processors in the south. Naturally, pig producers in the south will sell for the highest price, and the result is that there is a movement of pigs northwards. Slaughterings in Northern Ireland for the first seven weeks of 1996 are some 4 per cent up on slaughtering for the same period in 1995, while the corresponding figure for slaughtering in the south is down by 4.4 per cent. I vividly remember meeting a number of Cavan and Monaghan pig farmers in 1994 when they were about to go out of business and were here protesting about the price of pigs. Perhaps the two Deputies opposite would ask those people to supply the plants in the south rather than exporting their pigs across the Border.

Under the single market rules of the EU it is not possible to stop the movement of pigs northwards across the Border. In normal circumstances there has been a two way movement of pigs. Neither can national aids be given to the pig industry as the Common Organisation of the marketing of pigmeat precludes this. Therefore, neither I nor the Minister can intervene directly in what is essentially a commercial matter between producers and processors in the pig industry. The outlook for the industry is good, and as I indicated earlier, supplies are expected to become more plentiful in the latter part of the year. I would point out also that in the past couple of weeks pig prices have begun to ease and I hope this trend will continue so that balance can be restored to the pigmeat market.

I will, however, continue to monitor the situation and to keep in contact with Forbairt about the matter.

The Dáil adjourned at 9.30 p.m. until 10.30 a.m. on Thursday, 7 March 1996.

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