Léim ar aghaidh chuig an bpríomhábhar

Seanad Éireann díospóireacht -
Wednesday, 10 Dec 2014

Vol. 236 No. 4

Sustainable Agriculture and Dairy Price Outlook: Statements

I thank the Cathaoirleach and Members for the opportunity to outline the work my Department and its agencies have being doing to ensure the long-term environmental sustainability of Irish agriculture. The task of feeding the world while saving the planet, which sounds lofty but is a true reflection of the situation, is one of the greatest challenges facing this generation. Almost 900 million people do not have sufficient food right now, and the figure is doubled when we include the hidden hunger of nutrient deficiency. As the global population grows to 9 billion by 2050, the task of feeding everyone and ending the scourge of hunger will become all the more challenging.

It is not just a matter of growing numbers of people. As countries develop and more people move into what is considered the global middle class, they demand more variety and better food, more of the type of high-quality protein produced by Ireland, for example. The OECD says that this middle class will increase in number from 500 million today to around 3 billion by 2025.

For our agrifood sector, the opportunity from this growing food market is immense and so is the challenge, because we have to produce all this food while respecting the environmental limitations of the planet. It is not acceptable to sacrifice the future to the needs of the present by producing food in a way that degrades our soil and water, destroys our biodiversity or exacerbates climate change. It is clear that sustainable intensification of food production - producing more food while respecting and enhancing the environment - is the way forward.

Ireland has been a champion of this approach for several years in the European Union and internationally and I believe we are showing the way in how to do this in a practical way. My ambition is that we should be, and be seen to be, a clear global leader in sustainable food production. That is why I am here to briefly outline some of things we are doing to achieve this ambition and to seek the input of Senators.

In October the Taoiseach succeeded in persuading his colleagues in the European Council to adopt sustainable intensification as EU policy on agriculture and climate change. This was the culmination of years of work by my colleagues and me in government in seeking to persuade the Commission and other member states of the urgency of this issue and the appropriateness of this approach. I regard the European Council's statement as a very significant development, on which I hope future EU policy on agriculture and climate change - on agriculture and the environment generally - will be built. Ireland is also deeply engaged on this issue at international level. In the UN negotiations on climate change we have been one of the strongest advocates for a specific work programme on agriculture. What we are seeking at both EU and UN level is to develop a coherent approach to the twin challenges of climate change and food security, something sadly lacking up to now.

At national level, my Department is developing a low carbon transition and mitigation plan as set out under the Climate Action and Low Carbon Development Bill. This plan will take into account existing mitigation commitments and also outline a longer term view and seek to balance the objectives of allowing the food industry to grow so as to meet the food security challenges that face the world, as well as the need to meet future climate change ambitions. We are also preparing an agricultural adaptation plan which will seek to plan for the positive and negative impacts of climate change.

Emissions targets aside, Ireland must also meet stringent standards for water quality to meet our obligations under the water framework directive. Fortunately, Ireland has a favourable water quality status when compared to most other EU member states; however, there is little room for complacency in meeting the ambitious targets laid down in the directive. We face similar challenges in halting the loss of biodiversity.

Food Harvest 2020 set out a plan for smart green growth of the agrifood sector. The fourth annual progress report on the implementation of the strategy was produced earlier this year and outlines the many areas where progress has been made. Just two weeks ago I announced plans for a new agri-food strategy taking us to 2025, which I expect to be published next summer. Sustainability will again be at heart of this new strategy which will build on the very strong foundations laid in the implementation of the Food Harvest 2020 strategy.

The Origin Green sustainability programme is a key element of the implementation of the Food Harvest 2020 strategy. Since its launch in June 2012, it has been enthusiastically adopted by the food and drink sector in Ireland. As the first national programme of its kind to be rolled out anywhere in the world, it presents a major opportunity to differentiate Irish food and drink products from those of our competitors. At farm level, the beef and dairy sectors have fully established sustainability measures built into each inspection, which to date have covered more than 70,000 beef and dairy farms. Similar programmes will be rolled out over the course of 2015 for pigmeat, poultry, lamb, grain and horticultural production. More than 90% of all beef produced in Ireland is covered by the programme. In the first nine months of its roll-out to dairy farmers, over 40% have applied to join the programme. This rate of progress is expected to continue during the course of 2015. In essence, we can say we are now literally measuring the carbon footprint of beef herds at farm level using a carbon calculator internationally certified by the UK carbon trust. The broadening scope of the farm element of the programme to incorporate water, biodiversity and energy and socioeconomic information reflects the ongoing evolution of the programme to ensure it retains relevance and can help Ireland to achieve its goal of becoming a world leader in sustainable production.

In addition to the work done at farm level, more than 375 food and drink manufacturing companies have registered to participate in Origin Green, while almost 300 companies have signed up to the newly developed Origin Green online platform. The programme aims to have 75% of exports covered by members of Origin Green by the end of the year and by the end of 2015 it is anticipated that this figure will exceed 85%. Setting measurable and independently verifiable goals, it will enable us to achieve our ambition of seeing 100% of our food exports on the road to sustainability by 2016.

Ireland's water quality is favourable when compared to that in many other EU member states, with nitrate and phosphorus levels in water reducing in recent years. The EPA has identified a number of reasons for this reduction, including our implementation of the nitrates regulations. Earlier this year I worked closely with my former colleague, Phil Hogan, in reviewing these regulations to ensure the correct balance between supporting efficient farming and reducing nutrient loss from agriculture.

To support biodiversity, I introduced the Environmental Impact Assessment in Agriculture Regulations in 2011, designed to ensure environmental screening of certain agricultural developments at no cost to the farmer in supporting our biodiversity ambitions. More recently, my Department is supporting the rolling out of both the Kerry Life and Aran Life programmes aimed squarely at supporting biodiversity in these areas. Supporting biodiversity will be a key theme also within the forthcoming rural development programme which I will mention.

Together with high national standards for water quality, biodiversity and animal welfare, Ireland is rightly regarded as being among the most climate-efficient EU countries where food can be produced with least impact on the environment. This record of Irish agriculture in producing meat, dairy and other products with a low and improved carbon footprint is important to our credibility in persuading our colleagues in Europe to recognise the need for coherence in the European Union's food security and climate change objectives, as evidenced in the recent European Council conclusions to which I referred. In 2011 the European Commission's joint research centre published a study which confirmed that Ireland was a highly efficient food producer in terms of greenhouse gas emissions per unit of output. Senators can see the figures in the text of my speech, if they have received a copy. Research from Cranfield University in the United Kingdom, in conjunction with Bord Bia, shows that in a world in which fresh water is scarce Ireland has one of the lowest water stress measurements in the world, in other words, we can produce more food without having to worry about running out of water. This highlights the essential role of sound research to back up our claims about sustainability in Irish agriculture. We are supporting a range of research initiatives, at national and international level, on the many dimensions of sustainable agriculture.

In this regard, my Department has three competitive research funding programmes: Stimulus for agricultural production, FIRM for food production and COFORD for forestry research. Sustainability and resource efficiency were key themes in recent research awards under these programmes. As late as this morning, we launched the latest research programme in this area, which means that in the past three years we have made €85 million available for research on nutrition, sustainability and more efficient and better ways to produce food, while protecting the environment. This says a lot about the Government's commitment to the sector. While supporting research, I have also concentrated on converting it into real action on the ground and positive improvements at farm level. Initiatives include the carbon navigator tool, jointly developed by Teagasc and Bord Bia, which focuses on incentivising the adoption of best practices, allowing individual farmers to achieve greenhouse gas reductions and increase their efficiency. In October last year Teagasc launched a sustainability demonstration farm at Kildalton, where best practice in sustainable farming will be implemented, evaluated and shared. The project will be rolled out on a phased basis and plays an important role in training our next generation of farmers in the concept and practical aspects of agricultural sustainability. This research and implementation work, coupled with a comprehensive environmental impact study commissioned by my Department of Food Harvest 2020 and, most importantly, a thorough SWOT analysis, has helped to inform the policy strategies and design of several measures in our draft rural development programme which will take us to 2020.

I will set out the position on Common Agricultural Policy reform. The CAP has been a significant contributor to the environmental sustainability of the European agrifood sector in recent years and I was pleased, as chair of the European Council of Ministers, to have reached agreement on a new Common Agricultural Policy framework in June last year. Under the CAP, farmers will continue to enjoy significant supports but will have to comply with various requirements under cross-compliance measures, including statutory management requirements and the good agricultural and environmental condition provisions under Pillar 1. In addition they will have access to a range of enhanced and targeted agri-environmental measures under Pillar 2 of the CAP, the Rural Development Programme. I hope we will have these approved in the not too distant future.

Under Pillar 1, the newly reformed CAP provides additional opportunities to support sustainable food production. The focus on environmental protection has been strengthened, with the provision of a compulsory green direct payment under Pillar 1. This will account for approximately 30% of a farmer's total payment. In other words, if a farmer does not meet the requirements which are rather straightforward and easy to understand, he or she loses 30% of the single farm payment and is potentially liable for penalties also.

Environmental measures continue to be a strong feature of the draft rural development programme under Pillar 2 of the CAP. A key measure is the new green low-carbon agri-environment scheme, designed for 50,000 farmers at its peak in several years time. Financial incentives for farmers in implementing measures to support climate change, water quality and biodiversity ambitions will be available under the scheme. Additionally, support will be available for locally-led agri-environmental schemes that can be specifically targeted to meet local circumstances. Initially, this will include expanding the existing Burren farming for conservation scheme, but it will also include a completely new and targeted project aimed at conserving the freshwater pearl mussel, one of the most endangered species in Ireland.

The Rural Development Programme also includes measures on organic farming, areas of natural constraint and support for capital investments to address environmental objectives, for example, low emissions spreading equipment and manure storage. In addition, we will be supporting the establishment of knowledge transfer groups to optimise the environment for the transfer of the most up-to-date information on over 25,000 farms and the introduction of a cutting edge beef genomics scheme which will further improve the greenhouse gas intensity of beef production systems.

Some €4 billion in European and national funding has been earmarked for investment in the agrifood industry and the rural economy generally during the seven year lifetime of the new programme. However, the draft programme must be formally approved by the European Commission before it can be rolled out nationally. Securing this approval is an absolute priority for me and my Department.

The role forestry plays in contributing to climate change mitigation is often underestimated. That is why securing recognition of the role our forests play in carbon sequestration at EU level is so significant. I was pleased, therefore, when the European Council's conclusions in October specifically noted the role afforestation could play in carbon sequestration. This is important for Ireland as afforestation is a major greenhouse gas mitigation measure that we are undertaking on agricultural land. Under the proposed new forestry programmes it is aimed to plant 43,000 ha of new forest and build 690 km of new roads during the period 2015 to 2020. Management of these forests must adhere to the principles of sustainable forest management by addressing, in equal measure, the economic, social and environmental benefits forestry can deliver.

The initiatives I have outlined are covered in greater detail in a short paper for Senators. At this stage I hope everyone has received a copy, but, if not, it will be distributed presently. These initiatives will play an important role in underlying sustainable production systems in the future. Ongoing scientific research and investment in knowledge transfer leading to a high adoption rate of best practice at farm and processing level will be a critical success factor in striving towards our sustainable environmental goals. Recently, well informed international visitors, including the head of agriculture at the World Bank, have been impressed by what we are doing in the area of sustainable agriculture, but I am ambitious for us to do far more. Given our natural advantages and the quality of agricultural research, we should seek to be the global leader in sustainable food production. To say the least, this is not an easy task, but it is achievable. Achievement of the environmental ambitions of the water framework directive or delivery of the national biodiversity plan will be significant challenges, but we have done much already. Measures such as those included in the Rural Development Programme can continue to take us forward in a positive way.

I realise Senators were keen for me to speak briefly about dairy prices because it is a current issue. There has been much difficulty and friction in the past 12 months on the back of beef prices weakening. I am pleased to say things are now moving in the opposite direction and beef prices are strengthening. There is scarcity, prices are getting stronger and the measures agreed at the beef forum have brought greater transparency to the calculation of prices. This was helpful, in particular, from the point of view of farmers.

It appears that we are heading into a difficult six month period in the case of dairy prices. Teagasc expects an average dairy price next year of approximately 27 cent per litre, down from approximately 37 cent per litre in the past year. This is a major issue and it happens to be arising at the same time as we are planning for expansion and many dairy farmers are borrowing and making investments. The cost of production on a dairy farm will be somewhere between 25 cent to 28 cent per litre. When the price of milk falls to more or less the cost of production, major challenges arise. Dairy farmers receive the highest single farm payment of approximately €18,000 on average. Despite this, Teagasc has predicted that they could see a halving of their income next year, from an average of €64,000 this year down to approximately €34,000 next year. This prediction may not come true and we will have to wait and see what happens in the marketplace. There are things we can and will do to try to bring a balance to the market and have a floor for prices if they begin to fall rapidly in the coming weeks. The price in New Zealand is approximately 19 cent or 20 cent per litre for farmers. The price in Estonia, Latvia and Lithuania is approximately 21 cent per litre. In Ireland those farmers still producing milk are getting over 30 cent per litre.

We need to anticipate problems and plan. I have spoken in a serious way to all of the major banks in Ireland to discuss how they can support farmers in getting through what I regard as a temporary pricing issue. We need to work with Teagasc to ensure farmers manage their businesses and farm enterprises through a difficult period in minimising the costs of inputs and so on. Most important, we need to continue the conversation with the Commission, in particular, Ireland's Commissioner, to ensure it uses the tools available to try to bring a balance and stability to a market that will encounter difficulties in the coming months. These tools include aid to private storage which we are using effectively in the case of butter production. Ireland has used approximately 40% of what the European Union has paid out so far. This represents a significant and efficient use of the allocation. Another tool is export refunds. In other words, we could offload product outside the European Union cheaply and look to the Commission to make up the difference in price. This is an expensive option and one that is unpopular outside the European Union because it is seen as dumping on the markets of others and causing problems in them. I imagine the Commission would be slow to adopt this measure, although I can understand why many Irish co-operatives are keen to see export refunds in place in order that they could offload some of their product in storage.

The third tool available to the Commission is intervention pricing.

In other words, the Commission would buy product at a guaranteed minimum price level so as to put a floor under a falling price. It would store that product and then sell it in six or eight months time when the price had improved. We may well seek the use of that tool by the Commission, but it is too early to say so yet. In the next couple of weeks, we must monitor carefully what happens to dairy prices. Luckily, from the Irish perspective, most dairy farmers are drying off currently or have already dried off and we do not have anything like peak production of milk currently. However, this will become a serious issue for the broader sector when spring milk starts to come through. We also have product in storage that our co-ops must off-load and this is a concern.

One of the reasons for the difficulty is that the Russian market is closed. However, the primary reason is that for two years in a row there have been bumper harvests globally which have resulted in cheap grain, cheap feed barley and cheap maize. When we have cheap grain, it is only a matter of time before milk production increases dramatically, particularly in places like the United States and India. There has also been a very good grass growing season in New Zealand. We have seen higher increases in output than expected globally, but there has been a slight slowdown in the pace of increased consumption in China. As a result, there is more milk being produced than is being consumed. This will not be replicated every year, but we must learn to deal with this temporary problem. There are multiple ways of responding to this.

I wish to correct the record on something I said the last time I was in this House. I wish to correct a statement I made to the Seanad on 12 November when I contributed to a debate on matters relating to fisheries in regard to the importance of seeking to attract operators from other countries to land and process a greater proportion of the fish caught in Irish waters around Ireland. The record shows that I stated 1.2 billion tonnes of fish were caught in these waters. I do not remember saying this, but if I did, it was wrong. This was an error and what I meant to say was that the fishing opportunities in Irish waters have an estimated annual landed value of €1.2 billion - as opposed to a catch of 1.2 billion tonnes - and that this provides great potential for our coastal communities, particularly if we can attract more vessels to land and process fish in Ireland. In other words, only a relatively small proportion of the fish being caught around our coastline are being landed in our fisheries' harbours and we need to change that. I want to correct the record to ensure I am quoted accurately in the future in regard to that debate.

If Members have any questions or comments on today's statements, I am happy to try to respond to them.

I welcome this debate, as I welcome all debates on agriculture or fisheries. I heard the Minister's comment at the time but accepted it was a slip of the tongue, which can happen to any of us. I appreciate the correction he has made.

On the issue of sustainable agriculture, Fianna Fáil believes sustainable agriculture must involve a fair price for farmers who produce food in an environmentally sound manner. Farmers are the custodians of the land and must be recognised for their role. The Government has washed its hands of the issue and has failed to live up to the commitment of the Lisbon treaty in ensuring that farmers get a fair standard of living from the land. We call for an independent beef regulator to rebalance the power between the various actors in the market and for a special €200 per head beef genomics payment in 2015 to boost incomes. The Government's task is to create a strong, fair framework for the market to operate in so as not to leave farmers hanging in the wind at the mercy of big processors and large supermarkets. The Minister should prioritise working with the new Agricultural Commissioner, Commissioner Hogan, at EU level to place renewed emphasis on achieving a fair return for farm produce. There is a great opportunity for the Minister to do this.

In regard to the agrifood industry, the Minister has outlined the significant benefits this industry adds to the economy. The Rubicon of reducing the CAP budget has been crossed and the CAP will, inevitably, be further reduced in future years, no matter who is in power. This highlights the pressing need to emphasise a fair price for farmers in the future.

Looking at Pillar 1, single farm payments for Ireland have been reduced by €42 million per annum, from €1.255 billion to €1.213 billion, a 3.3% cut. However, if we factor in inflation at 7%, this is a 10% cut in real terms over the period. I know the Minister has done, as the late Jackie Healy-Rae used to say, "his level best" within Europe to get the best deal, but we must face up to the fact that Pillar 2 funding for Ireland, €2.2 billion, is a decrease of €313 million, a 14% decrease in funding. If we factor inflation into this, it is a 21% cut. This is hard to accept.

I have listened to the Minister in regard to the difficulties in the dairy industry. It is unreal to think that many farmers got out of milk because of the quota system imposed on them many years ago. Most of the dairy farmers in the part of west Cork in which I live have long got out of milk production and dairy farmers are scarce in peninsular areas. Now that the quota system is being abolished, there is huge fear and apprehension among farmers about what will happen. It is a terrible turnaround for them to think that if Teagasc predictions are anywhere near right, they could lose 10 cent per litre of milk. Most dairy farmers have spent large amounts of money and some of them have borrowed to develop their dairies and this vista will be difficult for them to live with.

I made the point in the House before that I would hate to see Ireland develop along the same lines as New Zealand, where major factory type farmers operate, milking 1,500 or 2,000 cows. If this happens here, we will reduce the number of active dairy farmers to approximately one quarter of the number we have currently. This would not be good for family farms and is not something we would like to see here.

The annual Teagasc income report 2014 recorded grave disparities in farm incomes, with dry stock farmers falling seriously behind their counterparts. Cattle rearing farms saw incomes decline by 22%, to €9,469 due to higher production costs associated with severe fodder shortages in the previous year. In particular, suckler cow farms are heavily reliant on the single farm payment to keep their heads above water. The gradual reduction in the staged farm payments will cut the ground from under their feet if the Government does not step in to ensure a fair price for their produce in the marketplace.

Farmers operate small businesses in effect and are extremely vulnerable to the economies of scale and market power of larger actors in the industry. Large supermarkets have used their buying strength to unilaterally reduce prices on a wide variety of produce by offering special deals etc. These short-term measures inflict long-term damage on the industry by eliminating margins. Supermarkets and processors need to live up to their responsibilities. The Government has a key role in ensuring this. Without a fair price to the primary producer, the entire food chain will collapse.

A number of factors, including labelling issues and processor manipulation, have created a sharp 12% reduction in beef prices, following hard on high prices for purchases last year. This is driving farmers under pressure over the edge across the country. Without going into too much detail on the beef crisis, there is a huge problem facing beef farmers. The Minister set up round table discussions with the relevant industry interests, which is welcome, but he must ensure he keeps on top of this issue. If the farmers producing milk, suckler cow farmers, or farmers producing calves and weanlings or farmers fattening cattle are not getting a fair price, there will be major implications down the line.

In the short term, a special €200 per head beef genomics scheme should be introduced, particularly for farmers in the suckler cow sector. This would cost approximately €107 million and would provide a shot in the arm for the agriculture economy in 2015, when payment support from the European Union will slip to an unprecedented low and other schemes wind up. I also have grave concerns about the operation of the new GLAS scheme and the maximum of €5,000 that can be obtained. Some time ago, the Minister assured me here that in so far as possible red tape would be reduced. Some of the farmers I met in the Beara peninsula recently have grave concerns, because without GLAS, previously REPS, payments, they will find it hard to survive.

The Minister is faced with many challenges, whether in the beef or dairy sectors.

We have a brilliant agrifood industry. I wish the Minister well in this regard. It is not easy to deal with all of these different issues, some of which are outside his control. He has a battle on his hands and I wish him luck with it. We should all wear the green jersey, fight for Ireland and fight for the farmers and try to get the best results for them. Whatever some people in this capital city might think, farmers do go through tough times, whether it is with weather, prices for milk or beef, or other ongoing challenges. I hope the Minister will do his utmost to ensure they get a fair return.

I welcome the Minister and thank him for taking the time to come to the House to discuss sustainable agriculture and the dairy price outlook. First, however, I congratulate the Minister on the announcement today of a grant award of over €20 million for agrifood and forestry research. This will go towards 58 scientist posts and 53 postgraduate students in specialised training places. This important investment in research will make a significant contribution to the sustainability and comprehensiveness of the Irish agrifood, forestry and aquaculture sectors.

With regard to sustainable agriculture, let us note that "sustainable" is defined as being able to meet the needs of the present without compromising the ability of future generations to meet their own needs. It should be considered in everything we do in order to ensure overall growth of the economy and protection of the environment and high quality of life for all the citizens of our country.

Agriculture and forestry have major roles to play in achieving these goals. Ireland has the potential to be a world leader in sustainable farming practices, sustainable forestry management, food production and research as we have a number of natural advantages. According to research by the European Commission, Ireland is among the top five performing member states in the EU in terms of carbon footprint for the livestock sector. The United Nations Food and Agriculture Organisation has found that the temperate grassland production system, such as that in Ireland, is one of the most efficient in the world.

Ireland has already put in place many measures to improve our sustainable levels in agriculture. A low carbon transition plan and a national climate change adaptation framework being prepared under the Climate Action and Low-Carbon Development Bill 2014 will drive the transition to a low carbon, climate resilient, environmentally sustainable economy by 2050. Programmes such as Origin Green are also available. This is a Bord Bia voluntary sustainable programme aimed at demonstrating the commitment of the Irish food and drinks industry to produce in a sustainable manner while meeting increased international demand. Schemes such as GLAS, the agri-environment options scheme, the organic farming action programme plan 2013-15 and the beef data and genomics scheme all promote sustainability in agriculture. I agree with my colleague opposite that GLAS in particular is very important for farmers in the poorer parts of the country in order to sustain their income.

The Common Agricultural Policy has had a substantial involvement in the environmental sustainability of the European agrifood sector in recent years. From 2015, the basic payment scheme will replace the single payment scheme. Under the requirements of the basic payment scheme, farmers are subject to three greening measures - crop diversification, which is applicable to farmers holding more than 30 hectares of arable land; ecological focus areas, which are applicable to farmers with over 15 hectares of land; and the protection of permanent grassland. It has been decided that this measure will be managed at a national level, thus there will be no implication for individual farmers unless national threshold levels are breached. These greening measures will vastly improve the viability of sustainable agriculture in the future. The level of emissions from agriculture has been steadily decreasing in recent years and I am sure the Department of Agriculture, Food and the Marine will continue to work with State and industry parties to ensure greater future competencies in the sustainable Irish agriculture sector.

In regard to the dairy price cycle, we need to be ready for the abolition of quotas from early next year. The ending of the milk quota regime represents a unique opportunity for the dairy industry to increase milk output and, as a result, the industry has set itself targets under Food Harvest 2020 of increasing milk production by 50% in the period to 2020. However, there are approximately 18,000 dairy farmers across the country, so the price of milk is an extremely prevalent issue. We cannot ignore the recent Teagasc report which predicts that average Irish milk prices in 2015 will fall to 27 cent per litre, a reduction of over 10 cent per litre on the average for 2014. This follows several years of very good incomes on dairy farms. It is likely to have a very serious impact on dairy farming incomes in 2015, with a reduction in excess of 50% possible on some farms. These are very worrying statistics, on which we need to act.

We also see change occurring in the make-up of farms. Several farmers are moving from beef to dairy and this will place even more pressure on the dairy sector. We must acknowledge, however, there are a number of factors outside of everyone's control which are putting negative pressure on the global dairy price at the moment. These include increased output of dairy production in countries such as the USA, New Zealand and Australia, and in the EU generally, due to favourable weather conditions this year, as the Minister mentioned in his statement, thus leaving more milk available on the market.

I thank the Minister for attending. I apologise as I have to leave to go to another meeting shortly. In regard to the Minister's excellent presentation and his vision for Ireland as a future global leader in sustainable food production, I have a question for him on fluoridation. As he knows, 98% of Europe has rejected fluoridation and Ireland is the only nation that is still fluoridating its water. We had a slight exchange in the agriculture committee earlier in the year and I know it is a subject that interests the Minister and on which he is waiting for a report to come out.

Anything I am going to say is fact. Fluoride is a highly poisonous substance. In America, every box of toothpaste, by law, has to state that a pea-sized amount of toothpaste is potentially a poison, although I do not have the exact wording of that warning. If somebody swallows more than a pea-sized amount, they need to contact a poison control centre - that is what is, by law, on every toothpaste box in America.

Critically, fluoride is added to tap water at potentially toxic levels. A glass of Irish tap water contains the same amount of fluoride as a pea-sized amount of toothpaste. Has an environmental study ever been commissioned by the Irish Government on the effect of artificially fluoridated water on our food and agriculture? Have the National Food Centre, Teagasc or Bord Bia ever tested the level of fluorides in our foodstuffs or drinks?

I have followed the Minister from the beginning of my time in the House and I am a great admirer of his and all he has done. I am also a huge admirer of Origin Green and of all that has been done in regard to Food Harvest 2020 and now the 2025 strategy. However, I could not let today go and talk about the future of the Irish agrifood industry without mentioning this topic which is in black and white in front of us. Why are we the only nation that does this? Israel, which has had fluoride for decades, banned it this year and it is prohibited by law in the Netherlands, whereas it is the law to have it here. I do not believe the Department of Agriculture, Food and the Marine is ever brought into the bigger picture. Water is a huge ingredient in our agriculture and food and drinks sectors. This is something that needs to be addressed. I would love to hear the Minister's opinion.

I thank the Minister for being here and, as ever, for presenting his case with clarity. There is much to be positive about here. The Minister outlined examples such as the research that is ongoing, the Origin Green programme and the involvement of Teagasc with Glanbia. All sorts of projects, schemes and research are ongoing, all of which are heading in the right direction and all of which are saying that sustainable agriculture is the way of the future. Indeed, I look forward to a moment when we will be able to debate agriculture without putting the word "sustainable" in front of it, because it must be sustainable. No other form of agriculture is possible, and this has always been the case.

The Minister said at the conclusion of his speech that he wants to do more because our natural advantages offer us that opportunity, and I could not agree more. My concern arises from this. Because of our natural advantages and the way agriculture has developed in Ireland - as part of our DNA and culture - it was never organised on a business model, and it certainly has not developed in that way. If we look at sustainability, what is missing is the notion of keeping rural communities sustainable, because without the rural community, nothing else is sustained in the way one would want it to be. One certainly will not be able to sustain the natural advantages in the way we do business, as we do now. Senator O'Donovan alluded to the notion of factory farming or big industrial farming, as we see in many other countries, and I concur with his point. I do not think that is a model that would continue to give us the advantages the Minister has spoken about. My worry is that if we do not continue to sustain rural communities, the very things knocking at the door are those big industrial-type farms, which of themselves are a different beast and have different sustainability requirements. I would be very interested in hearing the Minister's view, because we have seen what the free market does with prices to farmers in respect of milk, beef and so on. We see what happens when the free market is all we have.

Farmers are struggling. I am not talking about the very big farmers. The average farmer works very hard to make a decent living. They are the custodians of our environment and they do have a huge responsibility. We ask a lot of them in providing good, clean food and also being the guardians of the environment. I am not sure whether we pay them terribly well for the latter, and sometimes for the former. If we do not make it attractive for them to stay - if we do not say that our communities need to be sustained every time we stand up and have this conversation, and if we do not say that this is what we want and this is what we are aiming for - the whole notion of sustainability, with all the research, investment and schemes, will not be redundant but will be disconnected from that idea. That is my fundamental worry. I worry that we are heading away from rural communities and that kind of sustainability. I would be grateful to hear the Minister's remarks on that because, for me, that is the driving dilemma. I have no doubt about the Minister's bona fides and his policies in respect of crops, water, beef genomics and so on. I just worry about that bigger picture. I am not convinced that we are yet in a position at which our rural communities are on a sustainable path, because they require support, infrastructure and investment. I am not talking about a sentimental way of life - dancing at the crossroads. That is not what I am about at all. I support vibrant rural communities and hard-working farmers who can make a living and will continue to farm. Senator O'Donovan said that there are people who are moving out of dairy farming in the peninsula. People are moving out of farming in lots of places. That is just my fear - that we are the last of the nations to move into industrial farming. I am worried that this is where we are headed if we do not make that a central part of this debate. Otherwise, all of this is not quite redundant, but it seems to me to be the add-on piece, and I would also like to see the central piece.

The Minister is very welcome. Actually, I am not sure he is all that welcome, because I put some thoughts together before he came in and he must have read my speech - or at least, he said exactly what I had planned to say. I planned to start off by talking about the fact that the world's population would increase from 6.7 billion people to 9 billion people by 2050 and asking how we are going to feed all those people. I did not anticipate the figures the Minister gave, and I was very impressed by them because I planned to talk about the challenges and opportunities in the dairy market. I did not know of the likely anticipated surplus stock in the dairy sector, particularly in China.

The fact that we have such an increase in the world's population means that we need to look at new ways to farm if we are to continue. How are we going to feed those 9 billion people? If we continue along the same path, emissions will continue to increase, we will waste water and we will continue to kill crucial animals and insects. There are some very interesting examples from Europe. The Netherlands is notable in that it is moving ahead with technology and improved farming techniques, which I am sure the Minister is aware of. New animal sheds are being installed with underground conveyer belts which remove manure instantly. As a result, the Netherlands has the second lowest level of animal carbon emissions in the EU. Some of the greenhouses in the Netherlands have solar panels which produce energy for homes. I think we can do a lot more in introducing technology such as this to Irish farms. In addition, the Dutch example is interesting, as they are using this sort of expertise in technology and intensive farming and selling it abroad. One Dutch university has close links with China's biggest company. Ireland, with such renowned and massive dairy production, should be selling its expertise abroad in a similar way, and maybe we are. I am involved with the Institute of Food and Health in UCD and I know it has a strong link with universities in China. I have previously raised the example of Fonterra, the New Zealand dairy co-operative, which is establishing its own farms in China. Most interestingly, it is developing dairy products specifically to cater to the tastes of the Chinese consumer. The fragmentation of our dairy industry is hindering us and we have much more to do in terms of food innovation - not just selling Irish food products abroad, but developing country-specific products and catering for those specific markets.

Many scientists will agree that we need more intensive farming. That is not to say we need more crowding of animals into small spaces, but we need to increase productivity and look at areas that use fewer resources. It has been found that white meat is much better than red meat in terms of damage to the environment. It takes two kilograms of feed to produce one kilogram of chicken, while it takes five to 20 kilograms of feed to produce one kilogram of beef. We must take this into account. The figures are huge.

When we talk about sustainable agriculture, we also need to ask the difficult questions about genetically modified crops. I think I am the only one who ever talks about genetically modified crops. Everybody else seems to shiver when they hear about them. It is a simple fact that organic farming will not be able to feed the world. The proponents of genetically modified products argue that altering crops is nothing new, given that we have been altering crops genetically for 10,000 years. In respect of the safety of crops, the European Commission has funded studies involving 500 independent research groups over 25 years. The studies concluded that there is, as of today, "no scientific evidence associating GMOs with higher risks for the environment or for food and feed safety than conventional plants and organisms." Indeed, genetic modification can massively increase productivity - by more than 30% - and provide food security for people around the world who desperately need this. Professor Pamela Ronald from the University of California at Davis, argues that some of the benefits of genetically modified food include massive reductions in the amount of insecticides in the environment, improved soil quality and reduced erosion, proven health benefits to the farmers growing these crops, and their families, as a result of reduced exposure to harsh chemicals, economic benefits to local communities, enhanced biodiversity of beneficial insects, a reduction in the number of pest outbreaks on farms with genetically modified crops and neighbouring farms with non-genetically modified crops, and increased profits for farmers.

It is argued by Professor Ronald that "there is now a clear scientific consensus that genetically engineered crops and ecological farming practices can co-exist and if we are serious about building a future sustainable agriculture they must." I think we should be able to debate the issue of genetically modified crops and discuss whether crop productivity can be improved with science. I am not sure who is right in regard to this issue but we should debate it. We should not ban such a debate. Will we debate the issue or take an anti-science stance which poses the danger that our agriculture industry could be left behind? I mention this issue because it is clear there is an opportunity to develop this area and I think we are avoiding this debate. The lack of debate about genetically modified organisms and moving to this area means that we are losing out in the agriculture biotech sector where we could create hundreds if not thousands of new jobs if we are open to supporting this sector by making some decisions. It is strange that we are pro-science in most areas but not in the area of genetic modification. Given the recent horsemeat scandal, the agricultural sector should move towards more traceability to instil more confidence in the consumer. I am sure the Minister will tell us we are doing that already. I believe it is possible to do even more.

Scientific progress and regulation in this area will be beneficial. We need to use such technology to ensure that we do not sit still and we need to learn from countries such as the Netherlands to-----

I ask the Senator to conclude as he is over time.

-----move things forward in terms of intensive farming and integrating innovations into farms. I am sorry for rushing my contribution but the Minister stole my lines by giving me most of my speech-----

The Senator will have to conclude in order to allow everybody in.

I welcome the Minister and the opportunity to speak on sustainable agriculture and the dairy price outlook. If one looks up the word "sustainable" in the thesaurus it comes up as green, continual and viable. The most important word is "viable" as a word for sustainable. That is the theme on which I wish to speak because the viability of farming in what is a new outlook in terms of the schemes includes the new CAP agreement. We cannot reach a point where suddenly environmental issues mean that farms are no longer viable. It is important that the Minister continues to support agriculture especially in Ireland where we have a unique situation of the family farm. We are not into factory farms, such as in parts of the UK, the US and parts of Europe, and I do not think we should ever reach that point. We all know how valuable is the family farm. It keeps people in rural Ireland and it keeps people spending money there and in the local shop. It keeps people supporting the local post office and the local village. That is why it is important that any sustainable measures put in place must ensure the farm continues to be viable.

One of the most important points in terms of sustainable agriculture was the agreement reached in October with the help of the Minister when the Taoiseach succeeded in persuading his colleagues in the European Council to adopt sustainable intensification as EU policy on agriculture and climate change. This is important because we have a grass-based system and our greenhouse gas emissions were going to cause us major problems. The Minister has to work closely with the farm organisations and Teagasc to ensure decisions made in respect of the nitrates directive do not adversely affect the viability of farms. Another positive development in this and the other House in recent years was the adoption of the EU groundwater directive which provided for septic tank registration. It is important that all septic tanks are registered to ensure our groundwater is not affected. For example, in my own County Kilkenny, Glanbia, one of the major co-operatives in the country, received a grant of €13 million from Kilkenny County Council and the IDA due to the fact that it had a source of clean water. The Belview water supply scheme in south Kilkenny will come into production next year for liquid milk.

The word "viable" relates to moneys. The Minister mentioned the downward pressure on milk prices this year and that we may be facing a bill of more than €100 million. I raised the issue at the Joint Committee on Agriculture, Food and the Marine in regard to the super levy. This is an issue we have to look at. I appreciate that the Minister is in negotiations with the EU and the Commission and, hopefully, we can get a phased payment on this. This is important given the downward milk prices because cash flow will be a major problem for farmers.

In his contribution the Minister mentioned Pillar 1 and the new changes being introduced, including a compulsory green direct payment which will account for approximately 30% of a farmer's total. The 30% greening requirements are important for the protection of the environment. In order to qualify, approximately 10,000 applicants for the new basic payment scheme will have to make changes to comply with the new greening requirements. It is important they are not tied up in red tape and that we do not have to come here for a debate when the Minister and Senators and Deputies have been lobbied because some "i" was not dotted. We must ensure these people receive the maximum payments under the scheme.

The GLAS scheme is welcome because farming has been under pressure, especially the beef sector, sucklers and sheep, as 50,000 farmers-----

The Senator has 30 seconds in which to conclude.

-----will be looked after. If the economy improves, I hope the Department will be able to get more money to improve the scheme and get more farmers into it because it will sustain agriculture. It is important that the Minister continues to get funding for GLAS, that the rural development programme will provide investment support through TAMs and that there is continued financial support for education through Teagasc. If new farmers are coming on stream there will be new farming practices. We have gone from making hay to making silage and farming will progress-----

I ask the Senator to please conclude, otherwise the other speakers will not get in.

I thank the Acting Chairman. I welcome the Minister to the House. I will speak predominantly about beef. Nobody doubts the Minister's commitment to the job at hand and I am sure he is doing all he can. However, I wish to make a few suggestions about a number of things we should be doing. As the biggest surplus producer of beef in the EU we should be leading the way rather than following a Europe generated consensus, albeit that we might be feeding into. The Minister mentioned that the Russian market is closed. We need to be much more proactive in the context of markets and leading the way. Instead of France, the Netherlands, Denmark and Italy who have had their own bilaterals in terms of the supply of offal and live cattle, subject to quarantine and a very specific technical system which has been agreed between the Netherlands and Russia on traceability and access to their computers, they are subject to an inspection in the next couple of weeks and expect to be shipping by the end of December. There is a rumour that France is already shipping but I cannot verify that. Obviously a huge amount of produce is being smuggled in. The Russian shelves are still packed with European product.

They are only talking about offal. They are not-----

Offal is very significant. There are limited markets for offal. My business pre politics was exporting beef to 46 countries around the world through two BSE crises so I know a little about it but not as much as the Minister with the advice he is getting. I acknowledge that he is committed to the task at hand but I do not believe we are as focused or as successful as we could be. Instead of following and waiting for a Europe wide consensus on that issue we should be first in the queue to do a bilateral deal with Russia. Before Ukraine became an issue, Russia banned 70% visual lean or trimmings manufacturing beef to those who would not understand the lingo. It banned the whole of Europe.

Then those self-same countries, France, Denmark, the Netherlands, all went off, did bilateral agreements and got derogations on the ban. Ireland sat on its hands and said, "No, we better ensure we do not upset our European colleagues". We were the goody two shoes and sat back. Then this possibility was not open to us. The Ukraine kicked in then. The Ukraine aside, this is what is happening on offal. We are not struggling for markets in strips or fillets, in the main. There is no queue for offal. The fifth quarter is very difficult to market. It is a very difficult market to get into. The Philippines is packed to the hilt. That is the situation with Russia.

We need to be more proactive on this. Mr. Patrick Rogan, the former chief veterinary officer, was much more proactive than whoever is in the role at the moment in terms of, for example, trying to get out onto the market and getting deals done. On the Department website, there is a market access document, with which I am sure the Minister is familiar. It does not make for great reading. I forget which country or countries in particular this refers to but when one goes through the document one sees statements such as, "Sent proposed veterinary health certification by email April 2012. No reply." This is not what I would consider proactive marketing. That is an administrator administrating, ticking a box. We need more than that. I know it is not the Minister's personal responsibility to do this and the blame is not on him. Like other speakers, I have great time for the Minister's approach to many things. However, he needs more help than he is getting in the context of the market.

Bord Bia does a very good job. I have stood with it at stands many a time, at Enuga and elsewhere, and I know the Minister has been at those world trade shows himself, and he knows the difficulties that are there.

We need to be better at niche stuff. In America, there is a brand called Never Ever. It positions its products as having "never ever" been treated with hormones and so forth. The Bord Bia equivalent in America encourages the use of hormones. We do not. As the American market opens up, we could beat Never Ever to death because we grass-finish cattle.

I am nearly finished. If I could have a bit more time-----

Other Senators will wish to come in.

I ask the House for just 60 seconds.

No. Sixty seconds is far too long.

No, Senator. Absolutely not. It is not fair.

The Chair will let Senator Quinn speak for the whole day.

We want to get in.

Another Senator has come into this room since Senator Quinn spoke.

I missed my Adjournment matter yesterday.

Senator Mullen is now the kettle calling the pot black.

I ask the Senator to conclude. We need to move on.

I wish to mention one further important issue, namely, Article 39 of the Treaty on the Functioning of the European Union. This guarantees farmers a fair price for their labour. I would like to see the Minister, through Commissioner Hogan, raise this issue. There are no regulations in place to prevent the kind of anti-fair trade practices that are being implemented under the cloak of specifications, by UK multiples in particular. This is something we need to look at.

I welcome the Minister and what he has had to say and commend him on his good work. I was very glad to hear him refer to the hidden hunger of nutrient deficiency and the challenge of feeding so many people in the world today. These are people who do not have enough to eat.

With 170 million children under the age of five in the world today chronically malnourished, it is appropriate that I take this opportunity to mention to the Minister one of the organisations seeking to address this. This organisation is being honoured in Leinster House tomorrow. Mary's Meals provides, in a school setting, 920,000 meals to children in 13 countries across five continents daily. The Ceann Comhairle will present Mary's Meals and its founder, Magnus MacFarlane-Barrow, with the inaugural human dignity award tomorrow. The Minister will be very welcome at this event. It is appropriate that we note this and that we commend the work of so many good people, in Ireland and further afield, who are working hard to address world hunger and, in particular, the nutritional deficiency that blights so many young lives.

In addition to the appropriate statements on sustainability, it is important that we reflect on the challenges facing Irish farming at home. The Minister is to be congratulated on the hard work that he and his officials put into the new Common Agricultural Policy agreement. However, I wish to briefly address some of the issues facing the family farm. This is the UN International Year of Family Farming. In the 1971 census, 25% of households in Ireland were headed-up by a farmer. In 2011, the figure was roughly 6%. That change reflects the massive decline in the number of farm households over that time period. There has been a substantial increase in the non-farm population. None the less, farms and farm households remain central to our rural and national economies and, more broadly, our rural society.

A recent Teagasc report deals with the variety of problems facing such farms into the future. These include challenges from the globalisation of food supply chains, national and international policy developments, the end of the milk quota and climate change. The policy and economic changes ushered in by the ending of milk quotas, difficulty in obtaining credit and the drive towards bigger farms may lead to the end of medium-sized family farms and smaller farms and to the rise of the large industrial-type farming we see in the UK. This is something I do not wish to see happening.

The dairy sector, from which many of our family farms draw their main income, is by a number of measures our largest indigenous industry. It has exports valued at €3 billion or thereabouts if one takes into account the breakdown between animal, meat and dairy exports. The impact of the departure of the quotas on Ireland's dairy sector and its agri-economy will be dramatic. It is remarkable to notice the difference between dairy production in Ireland and in New Zealand where there is also a grass-based dairy system. Ireland's dairy production in 2013 was about 5.4 billion litres. This is roughly the same as it was in 1974. By contrast, in New Zealand it grew massively.

The growth in milk production will create massive opportunities for some farmers and for large companies and multinationals. This is to be welcomed and I congratulate the Minister on what he has been doing on foreign investment missions to the US, China, Japan and so on. However, let us not lose sight of the family farm. A large expansion is not going to be possible for everyone. Investment in new land and milking equipment is difficult for smaller farmers, and where there is an ongoing volatility in the price of milk it is going to be even harder. There is a real question surrounding profitability for smaller farms. I am worried this may be leading to an expand or die scenario, where large landowners with financial clout will ramp up production. I ask the Government to prioritise the continuing sustainability of small family farms.

Ba mhaith liom aird an Aire a tharraingt ar an agóid taobh amuigh den Teach agus tá súil agam go dtabharfaidh an Rialtas aird ar sin. I know the Minister is a cabinet Minister and it is hard to sit here without noticing the protest going on outside. I hope the Cabinet takes on board what is being brought forward by the protesters today.

I think sustainability is something of which everybody is in favour, but how to achieve it is a vexed matter when the aims of land use are taken into account. Meeting our agricultural targets and meeting our environmental responsibilities could result in some hard choices on land use. Already we have come up against choices and, as 2020 draws nearer, we might have to take decisions which could have serious implications for our agricultural output and our greenhouse gas emissions and about how to offset these, for example by the use of forestry. If we begin to use forestry in this way, do we damage our biodiversity? If we preserve our biodiversity, will we limit ourselves in terms of being able to reduce harmful emissions? Simultaneously, we must pay attention to water quality, protection of species and the maintenance of soil quality, and none of these things can be left on the long finger. While we are maintaining agricultural production, reducing emissions and maintaining soil quality, we have to be watching the rest as well.

Food Harvest 2020 is beginning to become Food Harvest 2025, as the European Union is developing it. We should be standing up for Irish farmers in that process, rather than finding in another few years that we are not going to be able to achieve its targets without compromising our agricultural output or biodiversity or some other key factor, just because the Government sat back and let Brussels decide rather than energetically involve Ireland in the formulation of Food Harvest 2025. We have seen the EU use incentives in seeking to protect our environment with the help of farmers. It is the farmer, as stakeholder, who is expected to be responsible for maintaining our farmland in its best condition, to be highly productive and also to maintain the environmental quality demanded by the EU, and expected by us too.

We have seen some schemes which have been very detrimental to the Irish farmer because commitments made were not fulfilled. It would be remiss of me not to bring up the issue of the hill farmers who protested again in Castlebar last week. They have serious issues on the GLAS agri-environment scheme and the collective agreement being put forward. I find the Minister to be quite accommodating when it comes to debate. I urge the Minister to sit down at the table with the hill farmers to try to find a conclusion and resolution to this.

I met them last week.

I met them on Friday and they were not happy with the meeting they had with the Minister last week. That is why they marched on the Taoiseach's office. I believe the Minister is a person who likes to find a compromise and I hope a compromise in this case will be found.

The case of the hen harrier drags on and has left farmers in dire straits. They are disillusioned and discouraged from participating in environmental schemes. The common good is of course served by protecting the environment, and incentives must be designed to serve the common good and support farmers to remain active on their land.

As has been said, next year we will see the end of milk quotas and predictions are that dairy farmers' incomes will drop by up to 10%. We share those concerns. While this is forecast under Food Harvest 2020, we also see plans to expand our dairy herd, which brings us into conflict with the aim of reducing our greenhouse gas emissions. We need much clearer action from the Government to address this anomaly. Our representations and participants in EU negotiations must strongly defend our strong agrifood dependence as an economy and emphasise the successes, albeit limited, achieved in reducing emissions, such as, for example, forestry, clean energy, general awareness of the environment and the need to reduce emissions in farming.

Ireland's agriculture should be viewed as a valuable resource in maintaining food security for Europe and the Government must argue this point vehemently, rather than allowing greenhouse gas emissions to be the main focus of our position. It must be possible to work against greenhouse gas emissions without compromising our capacity to be a valuable food producer. As the world's demand for food increases dramatically, this is our trump card not only for feeding a growing world population, but also for maintaining a rural way of life here based on sustainability and the preservation of the rural traditions which we value as a nation.

The small farmers on the west coast are very important to our economy and to sustaining our communities. They feel they have been left behind and that the emphasis is on viability and larger farmers. We need to make sure that imbalance is not allowed to continue.

There is a series of questions. Small farmers in the west of Ireland have not been left behind. Our actions as a Government show that in recent budgets, in terms of schemes and supports and the design of the new CAP, small farmers in the west of Ireland, in a proportional sense, are getting a better deal than anybody else. That is a fact.

There are many in the south west as well.

The comment was made about the west. In terms of single farm payments, we have examined redistribution from farmers who traditionally received higher payments to those who traditionally received lower payments. We have seen priority access to schemes for smaller farmers and disadvantaged areas. We are designing a new GLAS scheme which moves farmers in commonage areas from receiving the kind of payment supports totalling €75 up to €100 or €125.

It is not workable. That is what farmers have said.

With all due respect, this is not a done deal. We are in the middle of negotiating the shape and design of GLAS with the Commission. That is what I said to the people I met last week. They made a presentation to me, I listened to them, we discussed it and I said I would try to accommodate their concerns as best as I could in our negotiations with the Commission, which is exactly what is happening. They wanted me to change everything there and then, and announce it, but that was not possible because if I had done it I would have been totally dishonest with them. I do not know what I can finally sign off on unless and until we get an agreement with the Commission on what we can do in GLAS in terms of flexibilities, towards commonage, in particular.

As late as today, we have a team of people going to Brussels to negotiate on GLAS with the Commission tomorrow. People need to be patient. I am on their side. We are trying to get a flexible scheme that will work for everybody, such as a large dairy farmer in east Cork, a small commonage farmer in west Connemara or a farmer on an island. I have shown a commitment to those communities which they have not seen before, in terms of top-up payments for islands.

We are considering trying to allow farmers who have the capacity to grow and expand on the back of market expansion to do that and we are also trying to keep farmers in farming and on the land who might not have the same opportunities in the marketplace by supporting them with strong schemes and supports. That is what a €4 billion rural development programme is primarily about, namely, trying to achieve that balance as well as ensuring that we do everything sustainably.

In terms of the new strategy for 2025, it has nothing to do with Europe. We signed it. I have asked John Moloney, the former CEO of Glanbia, to chair it. He has another 27 or so people on the committee, all of whom are Irish stakeholders representing farmers, processors, food business interests, environmental NGOs and so on and who are designing an Irish strategy. The CAP we have signed off on complements Food Harvest 2020 which, to be fair, was put in place by the previous Government, and on which we have built. The idea that we are somehow being told what to do by the European Union in terms of 2025 is a total nonsense. It has no input. We have to be consistent with the standards that are required under CAP in terms of how we produce food, but we design what we do and how we do it on top of that.

On areas which have been designated on the back of a hen harrier protection programme - some land has been sterilised on the back of that - I am examining the issue and we will try to develop a support structure which will be acceptable to farmers and landowners dealing with that.

I can assure Senator Mullen that I have no intention, on my watch, of allowing Ireland to move from being a predominately grass-fed family farm system to some kind of Wisconsin factory farm structure. That will not happen under future Governments either. Family farm structures are very strong in Ireland. Land is not often sold outside of the family; on average a field is sold outside of a family once every 400 years in Ireland. There is a very strong attachment to land ownership and family farm ownership in Ireland, and that will remain the case. We are encouraging the maintenance of family farm ownership, but with a much more collaborative base for farming. Neighbours would co-operate with each other. Partnerships would be considered. There could be purchasing and producer groups which would collectively represent family farms to make sure they get a better deal in the marketplace and so on.

We can modernise farming in Ireland, get economies of scale into the system, within reason, and also maintain family farm ownership, which is hugely important in terms of rural society. I am not sure who said sustainability is also about viability in terms of rural communities, but that is very important in places like west Cork, Galway, the midlands and many other areas, irrespective of whether land is very fertile. I can assure the Deputy that family farm structures are the basis and heartbeat of rural Ireland as far as I am concerned, and we will maintain and support that.

On the expand or die statement, there will be plenty of dairy farmers who will decide that expansion is not for them. Such farmers have 60, 70 or 80 milking cows and want to stick with that, which makes sense as a business model for them because of the land and labour available to them, the cost base under which they want to operate and the lack of capital investment they want to make. That is fine, but the idea that globalisation means lower prices is not true. We have been operating in a global market for dairy products for the past two years and have had two of the highest years ever recorded in terms of milk prices.

What will be a feature in the future and what has been a feature for the past number of years is price volatility. We have seen the upside of price volatility for the past two years and now we are starting to see the downside. We cannot have it every which way. We need to insulate, hedge and protect farmers from the peaks and, in particular, the troughs of price volatility. There are ways we can do that, in terms of longer-term pricing contracts between farmers and their co-ops for a portion of their milk, which makes a lot of sense. We could set up futures markets for dairy products for co-ops to hedge against price falls. We have a series of market tools we can use at a European level to intervene when prices are falling rapidly and we need to put a floor on that.

We can also ask for and insist on a more tailored and improved response from banks to deal with significant price volatility in the context of the repayment of loans and so on. We are working on things to that effect. We can do a lot to try to insulate farmers. It just so happens that this is happening at the same time as we are about to abolish milk quotas. People who draw parallels between the two happening at the same time misread and misunderstand the market.

Milk prices have been falling for a number of months not because quotas are going next April, but because we had two bumper harvests internationally and a closure of the Russian market.

As a result there is a great deal of extra milk in Europe. We need to understand what is driving the oversupply if we are to arrive at solutions to solve the problem.

I take on board some of Senator Marc MacSharry's comments. I understand the point he makes about Russia, but there is a political judgment call to be made as to whether we should ignore the spirit of the sanctions imposed collectively by the European Union on Russia or to try to do deals. In terms of activity to find new markets, beef from Ireland is likely to get into the US market in the coming weeks, if not days. Ours will be the first European beef producers to sell into the United States for 16 years. Ours is likely to be only European beef in that market for the foreseeable future. It so happens that for the first time ever beef prices in the United States are actually higher than those in the European Union. Today, we have a team of scientists and veterinarians coming from China to inspect the beef industry, with a view to allowing Irish beef into the Chinese market, the first time European beef would be allowed into that market. I hope this will happen in the first half of next year. The two big target markets for us in the past two years have been the United States and China and we are really active in that regard. Senator Marc MacSharry is knowledgeable when it comes to this area. There is an offal issue also and I met the Russian ambassador three weeks ago to discuss it. In seeking new markets generally, we are extremely active and will continue to be because it makes sense to spread risk. I will take criticism in many areas, but it is unfair to accuse me of not being active in seeking new markets.

I take on board Senator Pat O'Neill's comments on GLAS. We need to get it open as soon as we can, but we cannot do so until we get the RDP over the line, or we obtain an assurance from the Commission that we can open a scheme while the programme is still being formally approved. We are working hard to do this, but it will be the new year at this stage before it happens.

I take on board many of Senator Feargal Quinn's comments. He talks a great deal about the Netherlands which in my view is a world leader in linking commercial research, agriculture and food production, but so are we. In the past three years my Department has sanctioned research programmes to a value of €85 million on the basis of a competitive tendering process to find the best projects across all of the universities and institutes of technology, linking with Teagasc and other organisations. If one looks at what Science Foundation Ireland is doing, it is putting tens of millions of euro into agriculture and marine projects which are being given greater priority than ever before. If one looks at the number of courses available in the universities, institutes of technology and agricultural colleges and the quality of the students taking them, men and women, one will see a transformation in the application of science and innovation and new thinking to food production and nutrition and dealing with all of the challenges we face. That will impact not only on Ireland but also on other parts of the world. I agree, however, that the Netherlands is a real competitor in this space ad that we can learn a great deal from it. Fonterra, a company in New Zealand, is hugely impressive in the volume of milk it exports, but in terms of sustainability, Ireland is ahead of New Zealand and I would argue the case with anybody.

Senator Susan O'Keeffe raised the question of rural communities remaining sustainable. That is very much part of the broader rural development programme and its objectives.

Senator Mary Ann O'Brien raised the issue of fluoridation, about which I have spoken to her before. We have made decisions on the fluoridation of public water supplies on the basis of advice from the Department of Health. It dates back to the 1970s and started as an oral health initiative to prevent tooth decay. Many families across Ireland have their own wells and it is not a requirement under law to have fluoride in water, but in the public provision of water - a topical issue - the decision has been made on health grounds to apply certain treatments to water to make sure it is safe to consume. We should assess this issue and look for international experts to assess whether it is still appropriate for us to continue to do this. I have said this to the Department of Health. My understanding is that we will look at this issue and seek independent international experts to make recommendations which we will obviously consider carefully.

I thank Senator Michael Comiskey for his comments on the importance of the beef market and getting new schemes up and running soon.

Senator Denis O'Donovan called for the establishment of a beef regulator. With the exception of the ICSA, farming organisations are not looking for this structure to be put in place. Establishing a new regulator would cost money, money that would otherwise go to support farmers and we would be sending a signal that we had a problem with regulation in Ireland and I am not sure we do. We have a very active competition authority which is now called the Competition Commission. It has written to me twice in recent months. There is a fractious and difficult relationship between farmers and processors and we are doing what we can to try to improve it through the beef forum, but what is much more important in my view is that we plan to set up professional producer organisations to represent farmers collectively. These producer organisations would have the legal right to negotiate on behalf of farmers on price. That would be much more focused and a much more successful way to improve farmers' negotiating capacity with the factories, rather than establishing another regulator. I am not sure what needs to be regulated in terms of the information the regulation would legally be able to access.

We are trying to convince the Commission that the current beef genomics proposals are acceptable and represent value for money as a climate change measure in herd management. That one can pick a figure and suggest it be €200 per head on the basis of wanting to support the income of beef farmers, with respect is a little naïve and opportunistic, given that it was announced, from a Fianna Fáil perspective, in the week of the ploughing championships. Nobody has taken it seriously since because people realise that when the suckler cow welfare scheme was started, the figure was €40 a head, which we doubled to €80 based on beef genomics, and a figure of €100 per head has now been set for the first ten animals. I would love to be able to have a figure of €200 per head, but we could not do it through a beef genomics scheme; we would have to do it through a coupled payment or other such measures, which means that we would have to take money from another sector, which would not go down too well.

I am sorry, but I must ask the Minister to conclude.

I agree that Europe-wide we need to look at the margins for primary producers in the prices offered by the supermarkets in order that they have reasonable margins on their produce. This has to happen at European level, as if we were to try to do it here on our own, the major multinationals would simply source produce elsewhere.

I agree that we need to tackle the issue of red tape. When the GLAS scheme is introduced, it will be seen to be as straightforward as such a scheme can be. I am taking on board the concerns expressed about the scheme by hill farmers, as well as by many others. It is a big and relatively complicated scheme, but once we launch it, it will be seen to be more straightforward than many think.