Mr. Padraig Brennan:

I will make a start and then allow Teagasc to come in on a number of those questions because they are quite broad-ranging. I thank Senator Paul Daly for the questions and I thank the Chair for the invitation to speak this afternoon, which we greatly welcome. I will take the questions one by one and please let me know if I do not answer them satisfactorily for the Senator. In terms of matching organic demand with supply or vice versa, when we look at demand for organic food over the past year, the Irish market has seen a growth rate of 16% in the retail value of organic food sales in Ireland. That is a strong growth rate. It is ahead of the total grocery market. We have to keep in mind that it comes from a relatively small base, in that we are still less than 2% of the total grocery market. We have seen over the last number of years some growth in the number of organic producers. This year’s organic farming scheme will see more producers coming through, over the coming years. Even in terms of the number of producers that are there, if we take the sheep sector, for example, there is considerable leakage of organic store lambs into the conventional sector.

Three out of every four store lambs that have been reared organically are being lost into the conventional sector and, therefore, are not slaughtered or processed as organic lamb. If we could minimise how often that happens, we could boost supply straightaway. With regard to other products, fruit and vegetables are obviously the main category when looking at organic produce. The level of imports into the market is very high. We cannot produce some of those products here but we could potentially produce others here if the price was right. It can be a challenge to produce such products competitively. There is potential for more supply to come through, which is very positive. I see demand continuing to grow. Maximising what is being produced on the ground is probably the first step.

With regard to whether markets exist if we were to achieve the target of 7.5%, we just kicked off a major piece of work with regard to market insights. We are looking not only at the domestic market in Ireland but also at the key export markets across Europe. We are particularly looking at the opportunities and potential barriers for Irish organic produce if and when we get more supply coming through the system. We want to look at matters sector by sector and see where there are opportunities to grow our presence overseas and to develop the domestic market further. Looking at trends seen across Europe, one would certainly see potential markets for more Irish organic produce over the coming years. We are hopeful that this insight will show positive outputs and give us a really good handle on where opportunities might exist.

With regard to the impact of Brexit, it is probably fair to say that the organic sector was not hit any harder than other sectors. One area affected was organic livestock as we tend to import a lot of grain for animal feed at times. That was delayed and disrupted for a period of time and such grain has become more difficult to source. That has an impact on our livestock output, particularly with regard to beef. However, by and large, the market in the organic sector was no more disrupted that the market in the conventional sector.

With regard to whether there are imports to Ireland which we could potentially replace, it comes back to fruit and vegetables in particular. If we can competitively produce some of the vegetables in particular, we could potentially offset some of the imports coming in. Likewise, in the cereals sector, we are only producing half of what is needed to meet the demand for organic oats. There is certainly potential there if we can get growers to start coming through the system. Even from the perspective of animal feed, if one could get more organic cereal growers into the system, it would help minimise that issue. There are certainly areas of imports which we could target over a period of time.

The Senator asked when an organic product loses that status because of food miles and so on. When considering the issue of food miles, one must keep in mind that these typically represent a very small proportion of the overall footprint of a product. The work that we have seen and the work we have done over the years in looking at some of these areas would suggest that the issue of food miles is not significant. Examples have come up in the past. New Zealand lamb coming into Europe is an example but the food miles aspect only made up approximately 2% of the product's overall footprint. The proportion of the overall footprint involved is relatively small and probably smaller than one would expect.

I know the Senator directed the question of consumer education towards Teagasc but perhaps I will also touch on it briefly. There is certainly a very positive attitude towards organic food and organic products generally among Irish consumers in particular. There is potential for consumers to purchase more but we are starting from a really positive position with regard to their perception of organic food. There is also a willingness to pay some extra for organic food. Research we did at this time last year suggested that half of consumers are willing to pay a premium in the region of 10% for an organic product compared with an equivalent conventional product. There is more work we could certainly look at doing as supply comes on board but we are generally starting from a positive point.

With regard to market expansion, we are hopeful that there is potential to grow the position of Irish organic produce on the Continent of Europe, in the British market and in the domestic market over time. To return to the Senator's first question, a delicate balance must be struck in matching supply with demand. We must ensure there is a supply pipeline coming through. If we create a demand among customers on which we cannot deliver, that can cause issues. We may be turning away longer-term opportunities if customers cannot get a product from Ireland or from an Irish producer. It may sometimes benefit the importers of such products more than Irish producers. We have to be as co-ordinated as possible in that regard.