Mr. Trevor Donnellan:

I will mop up a few of the issues my colleague, Dr. O'Mara, has not touched upon.

The first question, I think from Deputy McConalogue, was essentially about where we are going regarding agricultural greenhouse gas emissions. We are working to produce new sets of projections for the Environmental Protection Agency. What I can say at this point is that, certainly in the short term, we expect agricultural emissions to continue to increase. The question is whether over the longer term we will see a stabilisation and a reduction. This is before we take into account anything regarding Brexit or the mitigation measures that exist, so we are talking about what we call our base case view of what will happen to emissions. Certainly in the short term those emissions will increase, and this is largely, or exclusively, due to the fact that the dairy sector is expanding and there are more dairy cows in the system. Most of the drivers of greenhouse gas emissions in Ireland can be attributed to the bovine sector because its emissions are the largest component of the overall emissions. Over the longer term whether emissions will stabilise in that base case or maybe even reduce a little depends on how the suckler herd, the other part of the bovine herd, evolves and whether it stays the size it is at present or moves into decline into the future. This question depends on various things, including the level of support that sector will get.

Our new MAC curve which will issue shortly suggests that there are measures which could reduce emissions by up to 6 million tonnes. This is against the level of current emissions from the agriculture sector, which is approximately 20 million tonnes. We need to bear in mind that this may increase in the future. We are looking at a situation in which there is potential to reduce the overall emissions generated by agriculture and land use in the future but we would caution that there is a lot of work to be done to ensure farmers take up, for example, the 25 measures we talked about in this MAC curve that we will issue shortly.

One of the questions Deputy Kenny asked concerned Brexit and if we will be back here in a few years in a crisis situation if Brexit turns out quite badly from the agriculture sector's perspective. Limiting our discussion, given that we are talking about climate change, to the dairy and beef sectors, I think the beef sector at an industry level and a farm level has much more to be concerned about regarding Brexit than dairy. This is not to say dairy does not have concerns about Brexit, but the concerns are much steeper in the case of the beef sector. Looking at the two sectors as they are at present, particularly at the farm level, the economics of the beef sector is much inferior to that of the dairy sector. Profitability in dairy is very high; profitability in the beef sector, when one takes away the support payments it receives at the farm level, is pretty much zero. This situation will worsen under Brexit. A particular concern for the beef sector is that it has very high levels of dependance on exports to the UK, and what is not exported to the UK is generally exported to continental Europe. We have very little in the way of beef exports outside the European Union, and the European Union market is pretty stagnant in terms of beef demand. The demand is not very strong. If one contrasts this with the position of dairy, there is still some growth in dairy demand in Europe - small, admittedly, but it is still there - but more particularly at the international level, outside of Europe, there is strong demand growth for dairy products. This contrasts quite significantly with the position of the beef sector. What I am saying in short is that there are export opportunities for dairy both in continental Europe and globally that do not exist in the case of beef, so there is a difference there. I would also caution that in the dairy sector some dairy processors are more exposed to the effects of Brexit than are others, particularly dairy processors that have a significant production of cheddar cheese going into the UK market. Some processors do not produce cheese at all, so the level of exposure to Brexit from the dairy industry perspective differs across processors. The impact on both sectors, I think, would be negative but I think the dairy sector has a greater potential to power through the difficulties and get beyond it than the beef sector.

Another question, I think from the Chairman, was what we could do with the new CAP that would be beneficial in mitigating climate change. One thing we need to look at in this regard is some of the flexibilities that will potentially be offered under the new CAP to tailor the CAP to our own national needs and objectives. Clearly, since we are here today, the impact of agriculture on climate change is one of those concerns. The previous CAP reform - that is, the current CAP - has been very heavily criticised in all quarters, from the perspectives of farmers and environmentalists and right across Europe, as not having been very effective in its greening measures. As for the greening measures that were introduced, the original proposals were probably more extensive than the final agreement, which watered down the objectives that were set out from the greening measures. However, if we had greening measures under the new CAP which linked payments, for example, to some of the actions which Teagasc has identified and which are actually profit-enhancing for farmers or of relatively low cost to farmers, then we might see greater uptake of some of those measures which are part of our MAC curve and which might help to address some of the concerns about greenhouse gas emissions.

Finally, I think Deputy Healy-Rae asked the question whether we are worried about the hurt that this whole issue is likely to cause farmers. The way to think about that question is that dealing with climate change will have costs across society as a whole.

We need to balance those costs so it does not result in a situation where any sector is disproportionately burdened by addressing the issue. If there were no costs associated with addressing climate change, we would not be here today. We would have arrived at a decision about how to deal with climate change and we would go off and deal with it. If any sectors of society consider themselves to be losers as a result of dealing with climate change, there is a political question about how to deal with the issue of emissions reductions across the economy as a whole.