Brian Ó Domhnaill (Fianna Fail) | Oireachtas source

I thank the delegation and apologise for being late, but I was at a briefing.

The sheep sector is vitally important to many smaller holdings, particularly along the western seaboard where the farms are not as fragmented as along the eastern seaboard. There might be a small number of suckler cattle and sheep and the dependence on income from sheep is very high. The CSO figures show that the overall number of sheep in the June livestock survey was 5.16 million. This is up 1.3% on the 2014 figures but it identified a fall in the number of breeding ewes. In Australia and New Zealand, the production levels are around 86% of the overall sheep production in the world, but they also have a fall in the number of breeding stock. The sheep sector is at a crossroads. Farmers do not know whether to stay in sheep production, invest and continue breeding, or to have dry stock.

There are major demands on sheep farmers in spring when the ewes are lambing. It is not an attractive way of life, especially for younger farmers, and there is an issue, which I think the witnesses have touched on when they identified a need for an incentive for breeding animals. The figures would back that up. I think a decoupled payment for breeding ewes should be looked at. While the figures have remained fairly stagnant in the past four or five years, there has been a fall in breeding stock. If that fall continues, we will not be able to supply the emerging markets. The emerging markets in Europe are countries such as Germany, Sweden and the Northern European countries. We are exporting more at present to the United Kingdom and France but production of the breeding stock is up about 7% in the UK. That will obviously lead to an increasing internal supply in the UK. To try to deal with that, we must consider the emerging markets. The Far East is also an emerging market. The supply of lamb in the emerging economies is not able to meet the level of demand. There are opportunities in these markets.

I agree that Bord Bia has a role to play but the Department of Agriculture, Food and the Marine initially has a role to play in bringing about a decoupled payment for sheep, whether that should be an across the board payment per ewe up to a certain maximum number, similar to the previous payment of either £10 or £20. I think it is the right way to go. It is the only way we can incentivise production within the sector.

GLAS was mentioned as were the difficulties with the commonage. The commonage framework plans being implemented at present are causing huge difficulties. Some farmers want to have one plan in place. This is causing significant difficulties for farmers in my county with commonages. It is leading to farmers wanting to opt out of the new commonage framework plans, which is disappointing.

Bord Bia has identified emerging markets and has conducted extensive research in identifying market access. It might be an idea for the joint committee to engage with Bord Bia to ascertain what work it is doing to target some of those emerging markets. It may well say there is a lack of available supply, which goes back to breeding ewes issue.

Traditionally, lamb prices have been volatile.

Over the past two years there have been peaks and troughs in prices. They declined going into the middle or end of September and picked up again for the Christmas market but that is a cyclical issue every year. Price stability affects the lambing season because one can lamb at a certain time and hold on to lambs if one has after grass. I ask the witnesses to comment on prices in the lamb sector. Would a decoupled payment for breeding ewes bring some price stability? I know that prices are driven by the market and that the delegation will probably identify that fact.

The presentation has been helpful and useful. I support what has been said, particularly the suggestion of a decoupled payment. A lot of payment schemes, such as the TAMS, are very important to farmers who wish to invest in their farms but it takes investment to draw down funding. I would like to hear the thoughts of the witnesses on the following matter. I know a lot of farmers, and the delegation probably has the figure, who are up in years and want to hand the farm over to a family member or someone else. There is a lack of incentive for them to do so and one is nearly paid for doing nothing. I believe that an inbuilt production payment would greatly assist the sheep sector.