€40m beef plant now in doubt after Chinese backer refused access to investment scheme
Former Minister for Agriculture Barry Cowen demands answers from Government on decision that jeopardises proposed beef plant in Offaly
A PROPOSED €40m beef plant expansion in Offaly is now in doubt, leading to claims that the Government is facilitating a “golden circle” of meat processors.
The expansion of a small abattoir near Banagher received planning approval last week from Offaly County Council. The plant would have the capacity to slaughter up to 140 under-30-month cattle per day exclusively for Asian markets.
However, one of the key backers of the project, former Minister for Agriculture Barry Cowen, said it is now under threat because of the Government’s decision not to give the Chinese investor behind the project access to the State’s immigrant investor programme.
Successful applicants are granted permission to reside in Ireland for a fixed period; the residency rights also apply to their families.
Mr Cowen also claimed that the Government’s rationale for rejecting the investor’s application was that it’s not Government policy to pursue the development of additional plants.
IFA president Tim Cullinan called on the Government to clarify its position.
“The golden circle that the sector had become has to be challenged,” he said. “We badly need new entrants in the sector to shake things up. We see cattle being processed in Northern Ireland at far higher prices than here, and higher prices being paid for finished stock in marts. It is clear that we need more competition.”
ICSA beef chairman Edmund Graham called on Minister for Justice Helen McEntee to urgently review the “baffling decision” to refuse an application from investors under the Immigrant Investor Programme”.
The dominance of the three main meat processors ABP, Kepak and Dawn Meats over UK and Irish beef processing was further extended last week with Dawn taking full control of Dunbia.
IT’S 18 months since former Minster for Agriculture Barry Cowen first started working with investors led by a Hong Kong national to identify a site for a meat processing plant.
The site chosen for the ambitious €40m plan was the location of a previous small abattoir, Banagher Chilling.
Little is known about the investors in the project, with company records showing that the company’s current directors are Li Wang and Jianwei Wang. They have been described by Bord Bia as “committed”, “well-connected” and with “successful Chinese business interests”.
According to Cowen the company has a proven track record of exporting beef to Hong Kong and Vietnam.
He added that the majority shareholder in the lead company, Banagher Chilling, has been living in Ireland since 1999.
“He completed his third-level education here and operated in the retail and restaurant sector, until in recent years when he became involved in the export business to China and the broader Asian region,” said Cowen.
When, in July 2019 planning notices appeared in local press with details of the project, it was initially reported locally that the investors had plans to construct one of the largest meat processing plants in the country, killing over 250 cattle a day with the project likened to ABP’s factory in Nenagh.
The planning records seen by the Farming Independent for the project do not refer to that figure but do say the plant would process 140 cattle per day.
To achieve this, the existing slaughter line would be modified and lengthened within the existing abattoir building.
Additional cattle chills would be constructed, along with offices and staff facilities. The existing lairage would be extended, and the livestock yard increased in size.
In addition, the development would see the construction of a meat cutting, packing, blast freezing and cold storage facility with an output of approximately 50 tonnes per day.
In what would be a boon to beef farmers, the company planned to export the beef to Asian markets exclusively.
This is also indicated in the planning records which highlights Chinese demands for under-30-month cattle only and thus notes the plant will only process heifers, steers and young bulls.
There was some opposition to the plan, with one planning objection arguing that the proposed development had the potential to “cause huge carbon dioxide emissions at a time of national and global climate crisis”.
Farm organisations, however, hailed the project with ICSA beef chairman Edmund Graham describing it as of huge strategic benefit to the long-suffering beef farming sector.
Bord Bia also backed the project, and in correspondence seen by this paper it describes the project as “particularly opportune” given that Ireland became the first European country to gain access to China earlier in 2018.
A Bord Bia representative highlighted work being undertaken to renovate existing meat processing plants in Ireland to adhere to the demands to Chinese authorities.
It also highlighted that having the commitment of well-connected and successful Chinese business interests would be of major benefit.
Bord Bia indicated that it would be glad to support the proposal in any way it can, including through its offices in Shanghai and Dublin.
So it came as a shock when Cowen revealed last week that one of the project’s backers had been refused access to the Government’s Immigrant Investor Programmes open to applicants that invest over €1m.
Under this programme, successful applicants and their families are granted permission to reside in Ireland for a fixed period. Applicants must be high-net-worth individuals with a personal wealth of at least €2m.
Cowen (pictured) has said the decision could jeopardise a multi-million investment which was granted planning approval by Offaly County Council last week.
“To my utter dismay and disbelief, an evaluation committee made up of senior officials from relevant government departments and Irish State Agencies has refused the first such application,” said Cowen.
“Now I might only have been Minister for Agriculture for 17 days, but you’d hardly need a Green Cert to recognise that this conclusion in no way reflects the Irish farming sector’s understanding of government policy, which has for over 10 years sought to open Asian markets which this plant and project will exclusively supply.
“Beef and suckler farmers crave new markets, crave greater competition in the processing sector… most of all they crave opportunities, initiatives, programmes and Government policy that maintains and improves incomes for farm families.”
According to Cowen, the committee adjudicating the application concluded: “The proposed project is not an appropriate project for approval” and “the project does not align with Government policy in relation to the beef processing industry… it is not currently policy to pursue the development of additional plants where there is no established deficit in capacity”.
The ICSA’s Edmund Graham described it as totally unacceptable decision which undermines competition in a sector.
“Farmers are utterly frustrated at the closed-shop nature of beef processing. The committee has gone well beyond its remit in referring to Government policy to rationalise beef processing,” he said.
Cowen is demanding answers: “So, a €40m project which has the approval of the State’s Planning Authority, cooperation of Offaly County Council, the support of community and region, backing of beef farmers, support of Bord Bia and assistance of Agriculture Department officials has been resisted and disapproved by an evaluation committee that oversees immigrant investment scheme.
“Also, this project seemingly doesn’t align with Government policy? Who then is on this evaluation committee? Will they make available the various reports they sought from relevant Government departments?
“Will they enlighten us as to where is it stated in Government policy that there’s no deficit in capacity?
“I need these answers and I need them fast.”
The Minister for Justice, Helen McEntee said in the Dáil last week that while she could not comment on individual cases, there is “a comprehensive system and structure in place” to evaluate applications for the immigrant investment programme.
A Department of Agriculture spokesperson said there is no impediment to additional beef plants being established.
‘This conclusion in no way reflects the farming sector’s understanding of government policy’
In jeopardy: The site of the proposed development outside Banagher, Offaly