Huge demand for SBCI farm loans highlights funding crisis in sector

COMMENTING on the news that Bank of Ireland’s €65 million contribution to the overall fund being administered and lent out by SBCI has already been drawn down, the ICMSA President, John Comer, said that the massive demand for these loans demonstrated vividly the extent of the funding crisis in farms across the state and pointed to what he called the “consistent underestimate” of the financial challenges faced by dairy farmers in the wake of the milk price collapse in the 18 months up to last September. Mr Comer said that he was not convinced that our policymakers understood or appreciated the financial wreckage that resulted from such a prolonged period in which farmers were receiving a price substantially below the cost of production.

“Two things will strike most observers: the speed with which this money has been loaned out signals the acute financial position in which many farms – often very well run – find themselves as they work though the ‘Hangover’ from the 2015-2016 milk price collapse. The second question arises around the constant and long-term problem of funding being made available at competitive, realistic, interest rates. Farmers are asking – certainly ICMSA is asking - why we have such hype and hoop-la around loans being made available at interest rates that are still above those being charged by mainland European banks on their farm loans. We’re expected to be so grateful for these concessions on interest rates that we forget that these kinds of rates should actually be the norm. Farmers are so used to excess rates that we focus on this kind of concession instead of demanding of our Central Bank that we have funds available IFA NATIONAL Livestock Chairman Angus Woods has met with Irish MEPs, senior officials in the EU Commission in DG Sante, DG Agriculture, Commissioner Hogan’s cabinet and COPA, to reiterate the IFA call for a ban on Brazilian meat imports.

He said IFA received strong political support for a ban on Brazil and secured agreement that Commissioner Andriukaitis will be called before the Agriculture or Environment Committee in the European Parliament to answer questions.

Angus Woods said the EU must respond strongly and ban substandard Brazilian meat imports. “Commissioner Andriukaitis is going to Brazil and he must tell them in the strongest possible terms that Europe will not accept substandard meat imports that fail to meet European standards.”

In the European Parliament, the IFA Livestock Chairman met with Irish MEPs Mairead McGuinness, Sean Kelly and Marian Harkin as well as Northern Ireland MEP Jim Nicholson. “All of the MEPs were very strong in their views over the meat scandal that has emerged from Brazil in the last week.”

Angus Woods also met with senior officials in DG Sante and in Commissioner Hogan’s cabinet. “We made it very clear to the Commission that there are systematic failures in the controls in Brazil and the EU can no longer credibly rely on the authorities there to certify meat exports to the EU.”

The IFA Livestock leader said the real story and details behind this scandal have not emerged. “It is incredible that the EU Commission were only made aware of the issue through media reports. Attempts by the Brazilian authorities to try and confine the scandal to to borrow at the kinds of rates that are routinely charged by comparable mainland EU banks who borrow their money from the same sources as our banks and at the same rates.” a limited number of establishments are not credible, when the reports indicate that the government inspection and control authorities were operating fraudulently and taking bribes from processors to buy certificates.”

Angus Woods said this latest scandal and ongoing difficulties in Brazil point to a systematic breakdown of standards and controls. Based on previous FVO reports and the work of the IFA/Irish Farmers Journal investigation in 2006/2007, the EU Commission is fully aware of the failure of the Brazil authorities to meet EU standards. On this basis, the EU should act strongly now and impose a full ban.

IFA has written to the EU Commissioner for Health and Food Safety Vytenis Andriukaitis demanding a full ban. So far it is reported Japan, Canada, Korea, China, Hong Kong, Switzerland, Mexico and Chile have banned Brazilian beef and poultry in recent days.

The IFA Poultry Chairman Nigel Renaghan said the EU Commission must withdraw from trade talks with Mercosur while this investigation in Brazil is ongoing. “Standards and controls have to be at the centre of any trade discussions. The EU Commission cannot stand over negotiations with the Mercosur group against the backdrop of the very serious issues raised in Brazil.”

The latest developments also highlight the need for a strong policy on standards in the context of Brexit. He said, “In the IFA policy document on Brexit we have set out very clearly the need for equivalent standards on food safety, animal health, welfare and the environment and the need for the application of the Common External Tariff for imports to both the EU and UK”.