Ms Gillian Westbrook:

I will answer some of the questions and I will then pass questions to my colleagues who have more experience in the practical every day implications of organic cereal production.

In response to Senator Paul Daly's question on the tillage challenge, we have a shortage of supply. The cost of malting barley is around €180 a tonne. There is a demand for the raw material, but it is about getting enough people to come in for conversion. That ties up with Deputy Cahill's question about why more people are not coming in to supply the raw material. For a start, there is a 60 ha cap, and if one wants more tillage farmers to enter the market, one must raise the cap higher than 60 ha. For example, the limit in Wales is 300 ha. That is not for tillage - it is more sheep production - but the size is significantly bigger. Very few EC countries put a cap on the amount of land that will gain support under the scheme. Granted under the organic farming scheme one will get a less support for bringing more land into the scheme, but it would be a big boost for the tillage farmer to remove that cap.

In response to questions from Senator Daly and Deputy Cahill, there is also a two year conversion, which puts quite a few farmers off as well, which is a regulatory requirement and must happen. Taking account of the two year conversion period, one would only produce for three years of the five year period. One would have to measure the return over a ten year period.

Organic farming is very much demand led. Half of the land area would be in rotation to build up fertility in the soil, so the product will not necessarily be giving back a yield year in year out. Therefore, pretty much half of the land will be in rotation. The really successful organic tillage farmers, all of whom give me examples of land that is stockless, generally speaking have farms that are mixed enterprises, with beef and tillage in order to build up the fertility allowing them to use the land that is not in cereal production for those periods.

Deputy Cahill raised the issue of the road block. We do not have a coherent strategy for organic production and I would say that is the cause of the block. We tend to get merged in with Origin Green and different organisations such as that, which is fine up to a point, but we need a coherent marketing and promotion plan specifically for organic production.

To put it bluntly, sometimes there is a them and us division which can come from the organic side and which is not helpful. The product must be seen as an Irish produce for which there is a significant export market. There is a €30 billion export market sitting in Europe, which we are not taking seriously. Whether it is a result of remnants from the past, we should not be competing for the same space, we should be looking for different markets That can be gained from having a coherent strategy on the approach to marketing organic produce.

We do not target the scheme. I appreciate there may be criteria restrictions with which I am not as familiar as the Department of Agriculture, Food and the Marine and I will leave that question for it. Ideally, organic production should be market led, because if one opens the doors and lets everybody into the scheme, it basically pushes down prices elsewhere. Some processors might think that is a good idea but I think that is part of Deputy Fitzmaurice's point on the reason that farming are bringing their produce to the commercial mart, because they are not getting in to supply their beef. There is a limited number of processors, but in order for organic produce to be really successful - I am referring to countries that can demonstrate this - it is a multi-layered product. If one has all of one product, one does not tend to be as successful as somebody with many different commodities, such as livestock, dairy, cheese production, added value, beers. In such instances the whole sector lifts as opposed to having 90% in one sector. That also echoes a point made by Deputy Fitzmaurice.

The double-funding issue with GLAS is something we have asked about tirelessly. We agree completely on that. Clarification may be needed as to what actually constitutes and defines double funding as we were under the impression, and measure 11 of the rural development programme makes it perfectly clear, that the organic farmer is being paid to produce food for the organic food supply whereas GLAS is an environmental scheme. It is in response to the public demand for organic produce that the organic farming scheme was given a separate measure and supported as such. We agree with Deputy Fitzmaurice that it is not double funding and we agree that there has been quite a barrier as such for certain people. Having much of one product in there raises the question of what is actually being supported if this is not market led. Is it that one is just going to give it to people where there is no market? The counter argument to that is that one is paying people to be environmentally-friendly in their farming systems. However, the scheme is market led because it has to go through a value reporting process. As it is queried and audited as to its significant value and the returns to the Exchequer, it is market led. Perhaps we need to be clearer about the market. If we cannot be clearer about targeting it, we certainly need to support it with a full marketing scheme.

The front-loading aspect is again a question for the Department. As far as I am aware, and we have looked into it, it is not actually allowed. I do not think it is possible to front-load a per hectare payment, however I am not clear on it. We looked at it only briefly. Certainly, it is a question for the Department.

There are more processes coming online. Many of them represent a kind of chicken-and-egg situation. Farmers do not want to come on board with more product because they do not have the continuity of supply. They are concerned about coming on board with more product lines if that continuity is not there. Again, that is something the focus group on organic production, which is due to be opened quite soon, needs to sit down and think about. It is a huge market in the EU and there is a great deal of opportunity which we cannot help but feel we are missing out on to a great extent. It is a shame. My colleagues will address some of the other issues.