Mr. Aidan Cotter:

Senator Paschal Mooney has asked if Bord Bia engages with some of the more recent entrants into the Irish retail market. He mentioned Aldi, Lidl and Tesco in this regard. We engage with these retailers. Our members use the Bord Bia quality mark which is promoted widely by retailers, with which we work closely. This year we have been working with Tesco on a supplier development programme involving 16 Irish food companies and are working at three levels. One of these companies is focusing on expanding beyond its local area, another is expanding nationally within the Tesco retail chain, while the third is moving from selling nationally to selling to Tesco in the United Kingdom. Working with Tesco, the third largest food retailer in the world, to advance the interests of these Irish food companies has proved very successful. It is an important potential stepping stone into the international marketplace for Irish companies. Aldi and Lidl are very significant players in international and European markets. While they are discount retailers, many Irish suppliers regard them as very stable customers in terms of returns and doing business with them. We regard them as important outlets for Irish food and drink products and do everything possible to work with them to increase the penetration rates of Irish food products.

Senators Paschal Mooney and Susan O'Keeffe asked about artisan foods. We regard artisan foods as one of the great success stories of the Irish food and drink industry. In many ways, such companies provide a halo across the whole food and drink industry because of their high quality products, the premium position they occupy and the passion they show in the production and distribution of their products. I suggest the greatest profile for artisan foods is provided by the Bloom gardening and food festival held in the Phoenix Park every June over the bank holiday weekend. A total of 55 artisan producers show their products during a very successful five-day period. Artisan food producers have ambitions. The Senator referred to their presence in Harrods and Selfridges in London. Bord Bia carried out a significant promotion campaign for Irish specialty food producers in Selfridges earlier this year, most of which were artisan food producers. It was a very successful promotion and a very suitable campaign for these small businesses to show their wares, earn an income and seek future business.

Bord Bia administers small business grants for businesses with a turnover of between €100,000 and €3.5 million. In the current year it has grant-aided approximately 190 small businesses. These are very important grants for businesses which are innovative and creating new products for new markets. We work closely with small businesses. I refer to our website, bordbiavantage.ie, which contains information for anyone wishing to start a business on how to develop financial management systems and so on. It provides signposts for businesses to guide them towards the further assistance available.

Senator Paschal Mooney asked about global weather patterns. Unpredictable weather conditions are the single most important factor behind the volatility in the marketplace. However, long-term food prices are driven upwards in meeting the requirements of an expanding global population which is growing by 80 million every year. The middle class category is growing by 150 million a year and this class has shifting dietary habits, as we heard. On the other hand, there is the inability of the global marketplace to maintain supply to match that demand.

The Chairman asked about a fair return for producers. We have witnessed the end of the era of cheap food. Retailers and others will have to pay more for the volume of food products they require, while producers will have to be rewarded sufficiently. We have entered a new era in food production where the opportunities for the food industry are perhaps unparalleled.

Deputy Martin Ferris asked about co-operation and collaboration. This is happening in many areas along the supply chain. For example, groups of growers are coming together to combine their purchases of inputs in order that they have greater bargaining power to reduce their input costs by comparison with larger players. I showed a slide which the Deputy may not have seen. It showed the level of collaboration between the Irish Dairy Board and Cashel Blue following the launch of the co-operation project in 2010. It is also evident in what we call the China hub launched in April during the visit to China of the national delegation led by the Minister for Agriculture, Food and the Marine, Deputy Simon Coveney. We have expanded our office facility in Shanghai to include representatives of six other food companies, four of which are in the seafood sector. They share the same facility. There are meat companies which collaborate with each other because they operate in different sectors. They are sharing knowledge and resources and working together as one in the marketplace.

There was a question about Origin Green and the impact of GM foods.

What we have seen in recent time is the scientific trials that are being undertaken by Teagasc under the approval of the EPA. We would be confident that the safeguards that are in place during these scientific trials will be sufficient to ensure there is no risk to the reputation of Irish food and drink. As we all know, scientific trials like this take place and have been taking place for a very long time right across the European Union without an apparent impact on their food industries. They are scientific trials. As there is no production of GM foods in Ireland, there is no threat in that regard at present.

Senator Susan O'Keeffe asked about the sustainability charter and the targets set in it. We have sought that 75% of our food and drink exports would come from Origin Green members by 2014. In so far as this is a voluntary programme, 100% would come from such members by 2016. We have found at farm level where we are rolling out a sustainability survey, very significant acceptance of this among farmers. We have done a carbon footprint of 29,000 farms to date. There is no other country in the world that has been conducting carbon footprint on farms on what is, in effect, a national scale and a process of measurement feedback and continuous improvement. All of these farms must sign a permission for Bord Bia to access the AIM database operated by the Department of Agriculture, Food and the Marine so that we can access online the number of animals that have entered and left that farm and the number of animals that are on the farm, which is a key input into accessing the carbon footprint. The uptake by Irish farmers has been extremely encouraging and we expect that to be replicated right across the primary production sector. We are quite confident this will happen.

At the processing level we have 70 companies with an excess of 50% of our food and drink exports already signed up. SGS Ireland was only appointed as a third party verifier in September. Next week at SIAL all of the companies operating under our stand with the Origin Green logo are signed up members of the Origin Green programme. We are confident, without much work on our part, the companies are very enthusiastic about this programme. They recognise that this is an opportunity to set Irish food and drink apart. We have always been recognised for our green credentials. We are a warm, friendly and welcoming people. The caretakers, custodians and protectors as they are described in this video, who look after our farms have always done so through the generations. We are putting metrics and objective measurement around this and can then go out into the marketplace and sell it. This is perhaps one of the most important initiatives taken by the industry in recent times. This can project us in a fashion that differentiates us from everyone else in the marketplace.

Deputy McNamara asked about protected designation of origin and protected geographical indicators. We have limited uptake of these designations of origin in this county. That relates to the fact that they are more traditional, more accepted and recognised as a part of the southern European countries, particularly areas such as Italy, France, Spain and Portugal. We would like to see more of these designations of origins, recognising the high quality products that our artisans are producing. There is work under way by our Department of Agriculture, Food and the Marine and we provide any support that we can to promote this. We would welcome an increased penetration of these designations because they offer a major endorsement to the artisan producers for their products.

The Chairman referred to Olhausen, which is a very old and long-established company in the Irish food industry. It was a member of our quality assurance scheme and we were very concerned when it got into difficulty. It is clearly a very competitive marketplace. Retailers and food service operators are dealing with consumers who are shopping around from brands towards private labels. There is significant pressure from the consumer on one side and the retailers on the other and the distribution of power is not always perceived to have the equitable share that it might rightly have. The market decides in the world we live in. As I said the era of cheap food is at an end. Producers will have more power as we go forward and the world struggles to keep pace with the growth in demand.