Dáil Éireann Debate, Thursday - 26 April 2018
188. Deputy Bernard J. Durkan asked the Minister for Agriculture, Food and the Marine the extent to which profitability in the cereal industry here remains positive; and if he will make a statement on the matter. [18508/18]
Amharc ar fhreagraI know the Deputy is very much aware that I am committed to this important sector which plays a key role in the development of the wider agri-food industry. The tillage sector in Ireland is a key source of seed production, grain for the milling and malting industry and feedingstuffs for the livestock sector and as a consequence is a significant stakeholder in our agri-food industry from a supply/food safety and sustainability viewpoint. Cereal production in Ireland in 2017 was estimated at 2.3 million tonnes at an estimated value to the National Exchequer of €243 million. I am most conscious that the maintenance of an efficient and viable tillage sector in Ireland is of the utmost importance as it reduces our dependence on imported cereals and clearly contributes to the well being of the agri-food industry.
I would also acknowledge that cereal production has experienced difficult challenges in recent times both in terms of grain price and weather conditions. As a result of a very difficult Spring weather wise, I have requested a derogation from the European Commission in relation to the Crop Diversification (“3 crop rule”) requirement as part of Greening for 2018. I am confident of a favourable response on the basis that the criteria on which the derogation is being sought is similar to those used by other Member States who have recently been granted similar exemptions due to difficult weather in the Autumn/Winter of 2017. As a consequence of alternative crop options no longer being available to farmers to be compliant with Crop Diversification rules, growers can make crop choices that best suit their current situation, even if this leaves them non-compliant with the Crop Diversification rules.
Because Ireland only accounts for approximately 1% of EU production, grain prices here are very much affected by European and world market price shifts and tend to experience volatility. The current situation globally for the cereal sector is that it has experienced another year of high grain supplies which have again outstripped demand. This oversupply continues to exert a downward pressure on the market and this of course has had a negative effect on price to the grower. However despite the pressures on the sector the level of output has maintained at approximately 2.3 million tonnes.
My Department provides a range of supports to assist this vital sector. In 2017 I introduced the €150m Agriculture Cashflow Support Loan Scheme and extended it to cover the tillage and horticulture sectors. There was a very positive reaction by farmers, including tillage farmers, to the Scheme, which has proved that significant demand exists for low cost flexible finance. The “Agriculture Cashflow Loan Scheme” has provided a template for access to finance schemes, including the recently announced “Brexit Loan Scheme” for SMEs.
I would stress also that my Department provides a high quality official crop seed certification scheme to the industry, in addition to an extensive national crop variety evaluation programme.
I am also pleased to be able to say that a favourable response has been received with respect to the EU Protein Aid Scheme which has been secured for 2018 at the same level of funding as before. In 2017, €3m was paid out to Irish farmers under the EU Protein Aid Scheme, primarily for beans. Almost 14,000 hectares was sown by 1,200 growers under the measure and this is a significant increase from the 3,500 hectares that were sown prior to introduction of the scheme thus highlighting its success. On a broader scale the EU is in deficit in relation to plant protein and currently imports 75% of its plant derived protein requirements. In this context, the Commission is committed to preparing a report on plant proteins that will build on existing knowledge and national/regional experiences. It is important to state that I will be supporting measures designed to increase production of protein crops in Europe.
As a further support to tillage farmers I introduced the Tillage Capital Investment Scheme under TAMS II which opened for online applications on the 8 March 2017. The specific areas of investment include Minimum Disturbance Tillage Equipment, Sprayers, Rain Water Harvesting, Grain Storage and Grain dryers. There has been a significant level of interest in investments by the tillage sector, with a total number of 1015 applications received so far and 779 approvals. Over €2.63m has now issued in respect of 239 payment claims. Payments will continue on an ongoing basis and the Scheme is currently open to applicants.
Last year in response to the exceptionally challenging harvest conditions of September 2016 I introduced a Weather Related Crop Loss Support measure to assist farmers who experienced significant yield losses in spring cereal crops. This measure provides for a financial contribution towards the cost of uninsured spring cereals crop losses. Particularly hard hit growers who experienced even greater cereal crop losses benefited from an additional €100 per hectare, on the same area.
The agri-food sector is also exploring the development of niche and specialist markets for cereal products which have the potential to improve competitiveness and sustainability. The demand for Irish malting barley is growing in line with the sustained growth in demand for Irish whiskey. The opportunity offered by maximizing the amount of Irish grain must be developed to the benefit of all involved and I fully support the initiatives that help to attain that aim.
In conclusion I would also encourage tillage growers to fully implement the advice and research provided by Teagasc in relation to efficient and sustainable production of crops. My Department remains committed to assisting all involved in the sector to optimise efficiency and sustainability.
