Dairy­ing is our sweet spot – we must in­crease out­put be­fore things turn sour

Irish Independent - - NEWS - Ivan Yates

Ire­land’s food role model is in­fant formula – we ac­count for 11pc of global mar­ket share

I ’LL be broad­cast­ing on New­stalk from the Na­tional Plough­ing Cham­pi­onships at Tul­lam­ore on Tues­day and Wed­nes­day, fol­lowed by late-night live co-pre­sen­ta­tion of the new ‘Tonight Show’ on TV3 with Matt Cooper. When at ‘The Plough­ing’ – the Elec­tric Pic­nic of the farm­ing cal­en­dar – it ut­terly con­sumes you in its bub­ble of fran­tic feet tramp­ing around 1,700 ex­hibits. If you were to spend just four min­utes at every pitch, it would take five days to ab­sorb it all.

I’m very com­fort­able in the heart of ru­ral Ire­land. Farm­ing folks’ life­style and cul­ture are ir­rec­on­cil­able with mod­ern ur­ban liv­ing – a dif­fer­ent pace of life where time isn’t ros­tered, there’s less noise and neigh­bourly, per­son­able, face-to-face en­gage­ment su­per­sedes in­ter­ac­tion on face­less so­cial me­dia.

The fu­ture lies with city life, how­ever. A re­cent US pop­u­la­tion sur­vey re­vealed that in 1950 three out of 10 peo­ple lived in towns and cities. By 2050, that will be eight out of 10. The US to­day, Ire­land to­mor­row.

This year’s Na­tional Plough­ing Cham­pi­onships (NPC) mega-marathon could host 300,000 pun­ters.

A no­table mile­stone will be sales of the just-pub­lished book ‘Queen of the Plough­ing’, an au­to­bi­og­ra­phy by Na­tional Plough­ing As­so­ci­a­tion (NPA) di­rec­tor Anna May McHugh.

It’s a com­pelling read that chron­i­cles eight decades of or­di­nary fam­ily life in Co Laois and the his­tory of the NPA.

The book high­lights the NPA’s back­bone of demo­cratic vol­un­teerism. ‘A few life lessons’ is the best chap­ter and the ex­tra­or­di­nary suc­cesses of an iconic woman in a man’s world. McHugh’s adapt­abil­ity, can-do drive and com­mon sense are cor­ner­stones of the work that has seen the cham­pi­onships be­com­ing the largest event of their kind in Europe.

The NPC show­cases the agri-food sec­tor – the heart­beat of ru­ral Ire­land. As the bedrock of the in­dige­nous econ­omy, it ac­counts for €11.5bn of ex­ports, 163,000 jobs and com­prises 140,000 fam­ily farms.

Un­like air­craft-leas­ing fi­nance, there is no lep­rechaun eco­nomics, trans­fer pric­ing, state­less cor­po­rate tax avoid­ance or repa­tri­ated prof­its.

The agri-con­ver­sa­tion in Tul­lam­ore will fo­cus on the present state of milk and meat prices, har­vest and weather con­di­tions, farm in­comes – not the prospects for the in­dus­try be­yond 2020.

I learned in the 1990s that the fickle pop­u­lar­ity of the min­is­ter for agri­cul­ture of the day was in di­rect cor­re­la­tion to price of cat­tle that week in Tuam mart.

The Agri­cul­tural Science As­so­ci­a­tion, rep­re­sent­ing the brains trust of 1,800 agri­cul­tural science grad­u­ates, held its 75th con­fer­ence last week on the fu­ture of agri-food.

Of­fi­cial nar­ra­tives re­main ‘up­wards and on­wards’, as em­bod­ied in the Gov­ern­ment’s ‘Food Wise 2025’ plans, which tar­get ex­ports of €19bn, and its ‘Food Har­vest 2020’ plan, which iden­ti­fies a surge in global food de­mand in the com­ing years.

It could be­come com­pla­cent clap­trap if the im­pend­ing threats of Com­mon Agri­cul­tural Pol­icy (CAP) re­form and Brexit ma­te­ri­alise. Alarm bells are ring­ing – but who’s lis­ten­ing?

Euro­pean agri­cul­ture and re­lated sec­tors are the EU’s largest em­ployer, ac­count­ing for 44 mil­lion jobs. The CAP ac­counts for 38c in every euro of to­tal EU fi­nances.

The CAP’s an­nual €56bn pro­grammes are due to be re­viewed by 2020.

At last week’s con­fer­ence, the EU’s Agri­cul­ture Com­mis­sioner, Phil Ho­gan, warned of acute po­lit­i­cal down­ward bud­getary pres­sures on the CAP.

Back in 2004, the EU en­larged with the ac­ces­sion of 10 east­ern states, in­clud­ing Poland, Hun­gary, the Czech Repub­lic, Slo­vakia and Slove­nia.

Their farm­ers re­ceive 60pc of the di­rect in­come sub­si­dies ob­tained by ex­ist­ing 17 mem­ber states’ farm­ers. They were promised par­ity af­ter 2020. This can be lev­elled up­wards or down­wards, de­pend­ing on an in­creased CAP bud­get al­lo­ca­tion.

Last June, the EU bud­get com­mis­sioner, Gun­ther Oet­tinger, floated the idea of in­creas­ing na­tional con­tri­bu­tions of each mem­ber state by 0.1pc of GDP (cur­rently 1.1pc). Ger­many’s Wolf­gang Schauble dis­missed the propo­si­tion. Only three states – France, Aus­tria and Ire­land – favoured more cash for the CAP, de­spite par­ity obli­ga­tions.

The winds of po­lit­i­cal change in Brus­sels mean any ex­tra fi­nance ap­proved will be al­lo­cated at EU Coun­cil level to pri­ori­tise ex­panded EU de­fence/se­cu­rity com­mit­ments and cop­ing with mi­gra­tion pres­sures.

EU lead­ers rank in­ter­na­tional pol­i­tics above agri-ex­ports. Look at the im­pact of trade sanc­tions on Rus­sia un­til 2018: up to 2014, Ir­ish food ex­ports in­creased by 500pc over five years to €722m; since the EU-US block­ade of €12bn of agri-food out­put, sharp de­clines oc­curred.

The boy­cott has scup­pered this mar­ket into fu­ture self-suf­fi­ciency, as the Krem­lin pur­sues im­port sub­sti­tu­tion poli­cies. C AP re­form will also have to em­brace the fall­out of Brexit – cre­at­ing a €3bn black hole of miss­ing UK con­tri­bu­tions. No net con­trib­u­tor is of­fer­ing to make up any part of the €10bn net Bri­tish an­nual fis­cal trans­fers.

The in­escapable con­clu­sion will be the in­tro­duc­tion of a ceil­ing of di­rect pay­ments per farmer, (eg largest tillage op­er­a­tors/fac­tory beef feed­lots). This only achieves minis­cule sav­ings. Farm­ers’ cheques in the post will di­min­ish in the long term.

Of the food we ex­port, 50pc goes to Bri­tain, largely be­cause the Bri­tish and Ir­ish have the same con­sumer cul­ture and tastes.

Asian ex­ports are re­ally only ap­pli­ca­ble to the big play­ers of Kerry and Glan­bia, due to cost and scale.

The fun­da­men­tal fact, as con­firmed by Tea­gasc, is a hard Brexit of World Trade Or­gan­i­sa­tion (WTO) tar­iffs would wipe out en­tire mar­gins from our UK mar­ket overnight.

In re­al­ity, beef and sheep farm­ers still live on EU in­come sub­si­dies. Grain farm­ers have had no prof­its for sev­eral years.

Ire­land’s USP in food is grass-based milk pro­duc­tion.

We ac­count for 1pc of world out­put. The in­trin­sic com­pet­i­tive­ness of Ir­ish food lies in the per­pet­u­ally prof­itable sec­tor of dairy­ing.

Grass-based milk sell­ing for 24c a litre be­comes world-class un­der the Ori­gin Green qual­ity mark.

This ‘farm-to fork’ trans­par­ently au­dited process is the essence of sus­tain­abil­ity. Trace­abil­ity de­rives back to nat­u­ral soil and wa­ter.

Ire­land’s food role model is in­fant formula. We ac­count for 11pc of global mar­ket share, which is grow­ing by 2pc per an­num. That’s worth €1.3bn an­nu­ally. Su­per­sen­si­tive parental trust is se­cured by Ori­gin Green cred­i­bil­ity, with­out po­lit­i­cal or sub­sidy de­pen­dence.

Post milk-quota out­put lim­i­ta­tions, we need to scale up dairy farms to herds of 200 to 250 cows.

We must ad­dress loom­ing labour prob­lems through greater land mobility, with tax and ca­reer in­cen­tives mod­elled on those in New Zealand. That coun­try in­creased milk out­put from five bil­lion to 20 bil­lion litres over two decades.

The tec­tonic plates of EU pol­i­tics, CAP re­form, Brexit, global con­sumer trends and im­per­a­tives of en­vi­ron­men­tal sus­tain­abil­ity/cli­mate change are all shift­ing in one long-term strate­gic di­rec­tion: to dou­ble down on dairy out­put.

Pol­i­cy­mak­ers and ag­ri­giants must tar­get this sweet spot of Ir­ish agri-food to gain a com­pet­i­tive ad­van­tage.

Our des­tiny lies in re­fo­cus­ing in­vest­ment in in­fant formula.

Liam Hayes and Conor Cu­sack from But­ler­stown Na­tional School, Co Water­ford help launch Bord Bia’s Na­tional Po­tato Day on Oc­to­ber 6 on Ed­die Doyle’s po­tato farm in Moon­coin, Kilkenny. Photo: Pa­trick Browne

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