Charlie McConalogue (Donegal, Fianna Fail) | Oireachtas source

I thank Ms McPhillips and her team from the Department for appearing and for their presentation to the committee. The committee is engaging on this project of examining the beef sector in particular with regard to Food Wise 2025 targets because of the significant pressure on the beef sector and, specifically, primary producers and farmers. They are in the midst of a crisis. They are not immune to crises, having experienced many previously, but the one they are currently facing is particularly acute. It is an existential crisis for many farmers who may not be able to continue in the sector. I did not get the sense from the Department's presentation that there is a vision of how primary producers and farmers can be profitable or how to ensure a viable future for farmers in the beef sector in terms of being able to produce and make a profit from it. We know the figures in regard to how Food Wise 2025 is increasing exports and that the increased production of meat and beef is also leading to increased exports, although not to a sufficient level. That is of benefit to the country. However, the flipside is that the lack of sufficient markets for the increased beef we are producing is causing a significant crisis at farm gate level in terms of farmers not being able to make a profit. A key part of that has been the growth in our dairy herd and the fact that there is not sufficient outlet for the increased stock and beef coming off that dairy herd.

The committee previously discussed the issue of getting live exports, particularly at calf stage, out of the country. In her presentation, Ms McPhillips indicated that the Minister and the Government are making efforts in respect of live exports. I ask her to elaborate further on the stage that process has reached. The committee will seek to follow up on that issue and, specifically, the ongoing live export trade of calves coming off the dairy herd to France.

I ask Ms McPhillips to provide further information regarding the view the Department takes on the respective viability and future of the suckler cow and dairy beef sectors. How does the Department envisage the beef sector at farm level evolving over the coming years, particularly the suckler herd because there has been a drop in calf numbers coming off it in recent years? Without additional support, farmers will not be able to sustain a profit from the suckler herd.

Ms McPhillips referred to the positive impact which the beef producer groups may have. How might that unfold? Although I see the merit in them, if one is operating in a market which is already oversupplied, how much of an impact will the beef producer groups be able to make in terms of getting a better outcome and profit level for farmers? While I may be going outside the Department's territory, the prices paid are critical to where our beef sector is going. In recent months, the price paid to Irish beef producers has gone from 5% to 10% above the average price paid in the EU to 5% to 10 % below the average EU price. What is the Department's assessment of the dynamic at play there?

Ms McPhillips referred to moves afoot at Commission level in respect of unfair trading practices. That issue has been discussed by the committee. Will it be of specific benefit to the beef sector? Although there are unfair trading practices in the areas of groceries and contracts, and particularly vegetables and similar produce, I have never seen the impact such action could have on improving transparency in the food chain and, specifically, the pricing chain in the beef sector clearly explained.

The overall objective of Food Wise 2025 is to drive value rather than volume. However, that is not happening in the beef sector. While it is evident in other sectors, particularly the dairy sector, unfortunately there is more volume and less value increase in the beef sector and less profit for the farmer as a result. Deputy Cahill referenced the fact that we are not accessing the increased volume outlets for our beef. Leaving Brexit aside, that is something we need to promptly address as a country to avoid further pressure on beef prices.

The dairy sector has been rated number one in terms of carbon efficiency in Europe, while the beef sector is placed fifth. That is a big selling point for Irish agriculture and a key aspect of how we approach the climate change issue. The witnesses may have had the chance to assess the UN report published this week which would challenge how we make the assessments in regard to carbon efficiency. We have a very strong product domestically, but that report should be interrogated by the Department and a robust response offered.

Deputy Cahill touched on the fact that 96% of our exports are to the EU market. In spite of increased attention on market diversification and marketing, particularly in light of Brexit, there has been a volume increase in beef exports to the UK market in the past year. In light of its engagement with and feedback from Bord Bia, what is the Department's assessment of the potential for additional exports to non-EU markets and the likely trends in that regard?

The American market, in particular, despite much hype at the time, certainly has not delivered to the extent expected.

The one thing I have not touched on is Brexit. Whatever about the pressure the beef sector is under, a hard Brexit in a number of weeks would put the kibosh entirely on the viability of the sector. We must stand ready to intervene and provide supports in the event of a hard Brexit. I am keen to hear more feedback from the witnesses on the price supports that could be put in place in the event of a hard Brexit. From the engagement we have had with the sector, we have noted that aid for private storage or intervention that would have the impact of seeing us lose market space in Britain would not be sustainable in the short, medium or longer term. We have to be able to step in immediately if a hard Brexit comes to pass. Needless to say, our objective must be to avoid it because it presents an appalling vista, particularly for the beef sector.