Mr. Philip Carroll:

I will go over some of the situation with the markets, and then I will ask my colleague to fill in more of the detail concerning where this aspect is impacting on the current scenario. The first point to address is the scale of our operation relative to the European market. The scale of operations in Ireland represents approximately 1.5% of the total value and volume of the European market. Therefore, we are a relatively small player. We are exporting product into markets such as the UK, about 30,000 tonnes annually, the EU, approximately 45,000 tonnes annually, and Southeast Asia, about 170,000 tonnes annually. This means that significant volumes of exports are going outside the EU and more local markets, such as the UK. Each of those markets, in one way or the other, has shrunk considerably over time and this has led to a substantial amount of market distortion across all these sectors.

Regarding the economy and efficiency of production in Ireland, when we consider the scale of prices delivered by primary meat processors in the market over the past year or thereabouts, we can see that the Irish price has been considerably ahead of the prices paid by other EU producers. We can go into some of the details of those numbers. The context of the scale of the operation here and the necessity of moving our product off this island and into all those markets shows there is a significant differential between the price we are paying and that of others. Our price is ahead of what is paid by our competitors and has been for a significant period.

As far as the European market is concerned, the situation concerning ASF was one of the driving forces for the downturn that has occurred in recent times. The legacy of that situation is still having a hangover effect across the European market. Equally, the Chinese market, which, as I indicated, takes the largest proportion of the total volume of product exported from Ireland - and serving a market so far away has considerable cost implications - has essentially collapsed in respect of price. That has been the case for European suppliers as much as it has been for Irish suppliers. Despite all these prevailing circumstances, we are still in a position where we are leading on price. We are a small player in a global market. We are delivering considerable returns in the Irish market, notwithstanding the pressures which exist and the resources required to allow us to export into those markets.

Turning to the 10% cut mentioned by the Deputy, we must still see whether that materialises in the decisions made by the Government. It does not make any sense to us at all in the context I mentioned, namely, that we have 1.5% of a global market. If we reduce production in Ireland, we will simply allow pig meat to be produced elsewhere. Ours is such a tiny proportion of that bigger market that it is easy to visualise how that much additional production would then emanate from elsewhere. On the role of the industry in this context, I mentioned that the prices have led considerably. We are currently 10% ahead of the EU average price and 15% ahead of the price being paid by processors in the seven or eight countries that produce or process 80% of pig meat in the EU. That has been the response of the pig meat processing sector.