Oireachtas Joint and Select Committees

Thursday, 11 July 2013

Joint Oireachtas Committee on Agriculture, Food and the Marine

Bord Iascaigh Mhara Annual Report 2011: Discussion

12:30 pm

Photo of Andrew DoyleAndrew Doyle (Wicklow, Fine Gael)
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I welcome the representatives from Bord Iascaigh Mhara: Mr. Jason Whooley, chief executive officer; Mr. Donal Maguire, aquaculture manager; Ms Connie Kelleher, financial manager; Mr. Michael Keating, fisheries development manager; and Mr. Donal Buckley, business development manager. I thank them for attending today to brief the committee on their recent annual report, which has been submitted to the committee.

I remind the witnesses that they are protected by absolute privilege in respect of the evidence they are to give to the committee. However, if they are directed by the committee to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given. They are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against a person or an entity by name or in such a way as to make him, her or it identifiable. Members are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official by name or in such a way as to make him or her identifiable.

I invite Mr. Whooley to make his opening statement.

Mr. Jason Whooley:

I am thankful for the opportunity to address the committee on our 2011 annual report. I have a brief presentation that should take no longer than 15 minutes. It highlights the key activities of my organisation in 2011. We can take questions subsequently.

I will give the background to the organisation, provide a macroeconomic update on the industry and outline some of the key highlights across our three main customer divisions. These divisions cover fisheries, aquaculture, business development and innovation, and training. Training is actually part of the fisheries division but we will highlight what we did in respect of it also.

Bord Iascaigh Mhara, BIM, is the seafood development agency. It is our role to promote seafood development. We have bases around the country, in the main in the fishing ports. The organisation, a State organisation, was founded in 1952. We like to see ourselves as providing an integrated service to everyone in the seafood sector, be they fishermen, processors or fish farmers.

We have 125 staff, which number is reduced from 175 in 2009. We have, therefore, had a considerable reduction in staff since 2009. We have five key strategic objectives. The first concerns adding value to the fish we currently land, be it farmed or caught in the wild. The second is scaling the sector, in that we believe there is a big opportunity to grow the sector from its current turnover of approximately €850 million to in excess of €1 billion. To do that, we need large-scale operators. The third concerns the critical supply of raw materials. There is a big future in processing in Ireland and adding value to catches. To do this, we need to increase the volume of raw material supplied by various means. Fourth, sustainability is critical. Anything we do in the sector must take into account the sustainability of stock. Fifth, if we are to grow the sector, it is imperative that those involved have the requisite skills to enable them to maximise the opportunity that exists.

Broad figures for 2011 show that the sector was worth approximately €750 million. The negative aspect of this was a 4% reduction, as one would have anticipated, in the domestic economy. Difficult times were experienced. We believe this levelled off during 2012 and 2013, but 2011 was difficult for those in the domestic retail sector. The export position is much better. During 2011, we recorded a 13% increase in exports, a very sizeable gain. We saw double-digit growth in 2012, as high as 17% or 18%. There has been growth in excess of 30% over a two-year period.

Some 11,000 people are employed in the sector. It is critical that they are employed in coastal areas where, as we have said on numerous occasions, there are very few economic alternatives.

Let us consider the current market focus of exports. Not surprisingly, Europe is our biggest market. Dependency on this market has reduced slightly over recent years. What we have seen is growth in Asia and Africa, primarily in respect of our pelagic species. There is very little trade with North America, which we regard as an opportunity. We envisage major opportunities for the sector in Asia.

Consider the key highlights for the different divisions within BIM. The fisheries development division deals exclusively with the fishing fleet, both offshore and inshore, in our various ports. I will first deal with the financial elements and then refer to specific projects. Overall, we invested approximately €636,000 in fisheries grants in 2011 in areas such as safety, which is very important given the announcement this week. With recent tragedies, we cannot have enough invested in safety and safety awareness. We upgraded 87 vessels during 2011 for safety purposes. We also helped fishermen to invest in their fishing vessels. In 50 cases, this was to enhance on-board quality. It is critical that we get young blood into the sector. Two young fishermen received grants from us of €50,000 each in 2011.

We had smaller scale investments in lobster V-notching. Over 200 vessels benefited from lobster V-notching. With regard to seafood environmental management systems, over 230 vessel owners received financial assistance from BIM to enable them to bring their vessels and catches up to a certain standard to allow them to label catches as caught in an environmentally friendly manner and sustainable.

With regard to some of the key projects we are involved in from a fisheries perspective, members will have heard over the past 12 months, in particular, about the drive at European level, including by the Council of Ministers, to reduce the amount of discards from EU fishing fleets. The impact on the Irish fleet is particularly important to us. We have been involved with various measures on discarding to try to work with the industry to try to identify fishing gear that will catch fish more selectively and, in particular, avoid certain species or reduce the number of juveniles being caught in our nets.

Two of those involved a cod recovery programme and what is called a Seltra sorting box. On one side of the hold there are adult fish, while on the other side there are juvenile discarded fish. That is the extent of the problem in some of our fisheries. We are trying to work with fishermen to introduce grids like this into their fishing nets to determine if they are more suitable from a selectivity perspective, so that the non-critical catch escapes and the commercial catch is retained.

In the image one can see the juvenile fish swimming out through those square meshes. That type of selective gear is essential for the protection of fish stocks and the long-term security of this industry.

BIM is involved in a large number of other areas, including the tagging of albacore tuna, which is a valuable fishery. Our fleet is currently chasing tuna 400 miles south of Ireland, nearly as far down as the Azores. Some of the technology those vessels are deploying was developed in partnership with BIM. We are also involved in key projects such as avoiding cetacean by-catch.

In addition, what does a fishing vessel which is 100 miles offshore do with its waste? How can we ensure that environmental considerations are taken into account from a waste management perspective? We have been involved with the industry specifically on projects that will see them baling and recycling the waste netting they might come across.

Aquaculture is another key area for BIM. In 2011, we invested €654,000 in aquaculture projects. That includes a commercial aquaculture scheme which comprised €104,000 for four recipients. There were also 25 recipients in an aquaculture development programme.

BIM is also involved in the development of appropriate assessments, which are essential for Ireland to comply with the EU birds and habitats directives and Natura 2000. A lot of staffing work has gone into that area.

In 2011, we made a lot of progress with seaweed. It is new and different and we think it has considerable potential for the Irish sector. Almost 1 million tonnes of seaweed are grown in China every year. In 2011, we developed Ireland's first commercial seaweed farm off the Kerry coast in Dingle Bay. That is now harvesting commercial quantities of seaweed which is sold both here and on international markets. The images give examples of some of the trials BIM staff have done to enable this company to develop its own commercial operation.

Members of the joint committee may have heard that BIM is involved in a new salmon farm off the Galway coast in the lee of the Aran Islands. We term it a new approach because we have been working with scientists at the Marine Institute to investigate suitable locations. Having gone through a number of locations, we think we have found a very good one off the Galway coast.

We received work packages from the Marine Institute in the following areas: farmed salmon and wild salmonid interactions, including sea lice and escape issues; hydrography and oceanography, including modelling of waste products, dispersal of any medicines used on the farm, and modelling of other possible environmental impacts; information characterising the marine environment at the proposed locations, including wave climate predictions, the fate of all and any emissions from the proposed farm, and the nature of the water column; and ornithology, both in the vicinity of the proposed farm and in the protected areas in and around the farm. We got all that scientific information from the Marine Institute, which led us to believe that we have a viable site off the Galway coast. Following receipt of the information, we proceeded to apply for a production licence. That was the first time that a State agency like BIM has applied for such a licence. If we are successful in obtaining a licence it is our intention to seek a suitable commercial investor to operate in that location. We also have plans to move to a site in Mayo and, in due course, a site in Donegal. The screen image shows the site in the Galway area.

From a business development perspective, BIM is involved in helping our processing sector to add value to the catches being landed. We also want to help it to invest in the capital costs of increasing capacity and expertise within its plants. In recent years, BIM has been successful in creating additional jobs in the processing sector. The figures are included in the presentation.

We have also had success in working on programmes like Lean SeaPro manufacturing and Green Seafood to ensure that there is full environmental compliance throughout the value chain - not just from the fishing vessel but all the way through to the catching and processing sectors. There is a requirement from a market perspective - particularly concerning the multiples - for that level of traceability.

BIM also works with the processing sector to attain BRC or HACCP accreditation so that the top level of standards are attained by the processing sector. That enables us to compete in the highest possible value markets. Targeting markets that offer the highest price premiums must be the future for Irish seafood. Those big niche markets - that is not a contradiction - are the future for Irish seafood, rather than competing at a commodity level.

BIM also offers a comprehensive service to the Irish retail sector which is offering fish, whether they be multiples or independent retailers. We work with them on cold-chain management, labelling, branding and customer service. That includes everything from their displays to their pricing. BIM staff work with these companies to try to make fish more attractive and available to consumers. The overall value of the domestic sector might have fallen in the last 12 months but, in fact, the amount of fish has increased. That is particularly so for the more valued species such as hake. BIM works on a value-added scheme which is specifically aimed at taking existing commodity players and transforming them into companies that add more value and make more efforts to address what modern consumers want, as opposed to just exporting on the hoof. That is more easily done in some cases than others, such as pelagic fish. We accept that the latter is more of a commodity trade.

BIM is also working with UCC to develop a graduate programme. We now have young graduates coming into the sector every year who are trained in BIM for six to nine months. They are then placed out in the industry to engender new blood, new thinking and enthusiasm into a sector that has real potential. The appetite among graduates for these jobs is enormous. The sector is seen as a new growth area, which is an important image for BIM to project.

Boarfish constitute a new business development project. BIM discovered this fish species with our scientists in the Marine Institute. Over the last two years, a quota has been set and Ireland's quota is approximately 56,000 tonnes. BIM believes that there is a real future for boarfish, even though it is currently being sold exclusively for fishmeal. It is only approximately the size of the palm of one's hand. We have the majority of the total allowable catch, or TAC, in Ireland. BIM believes there is major potential to take this fish - approximately all 56,000 tonnes of it - and develop a new high-value species that will be attractive to international markets and Asian markets in particular. Even though it is a pelagic fish, like herring and mackerel, its flesh is similar to cod and whiting. There is a major opportunity for us in that regard.

In 2011, we were in Qingdao, China, with the different product formats developed in our seafood development centre, trying to attract international interest. I am certain that over the next two years we will see a considerable amount of that fish going into the human value chain, which will be an enormous boost for the processing sector. We did the same with blue whiting. Historically, it was never eaten, but by 2012, 80,000 tonnes of that fish were landed in Killybegs for human consumption. We believe the same transformation is possible with boarfish.

Our seafood development centre, based in Clonakilty, Cork, is the only dedicated seafood centre in Ireland and one of the few in Europe. In 2011, approximately 300 companies went through the centre, resulting in 20 new product launches. It has incubation space to encourage companies, whether large or small, to avail of our technologists, business development expertise and facilities. This has proved to be very successful.

Training is a critical area that is often overlooked in every sector. It is important in the seafood sector because of changing technologies and the dangers associated with fishing as a profession. We have two excellent training facilities in our national colleges in Greencastle, County Donegal and Castletownbere, County Cork. In addition, we have coastal training units which take the training to communities as opposed to communities having to go to the colleges. During 2011, those units, similar to mobile cinemas, visited 29 different locations. There is a significant uptake from the industry. With the recent announcement in Union Hall, County Cork, by the Minister for Transport, Tourism and Sport, Deputy Varadkar, and the Minister for Agriculture, Food and the Marine, Deputy Coveney, we expect a further increase in throughput in these coastal units, as well as at the national colleges. Since 1999, 8,000 students have gone through the school at Castletownbere. Obviously, some of them are repeat students upskilling but the figure is still significant. There will be a big focus on training in 2013.

During 2011, we trained 1,250 individuals. Areas covered include fisheries and aquaculture training, seafood safety training, safety training as well as workshops and different career events around specific areas such as fire fighting and vessel stability.

I thank the committee members for their attention and welcome any questions they might have.

12:50 pm

Photo of Brian Ó DomhnaillBrian Ó Domhnaill (Fianna Fail)
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I welcome Mr. Whooley and the other officials from Bord Iascaigh Mhara, BIM. I recently had the opportunity to visit the seafood development centre in Clonakilty. It is a wonderful facility with excellent work being done there. I commend all the BIM staff for their excellent work.

Clearly BIM is not resting on its laurels and examines new sectors in the fishing industry which could be potentially developed. I know BIM has nothing to do with quotas. However, I have always been of the view that we need to examine added-value processing. The work done by BIM in this regard is encouraging. What is the position of the boarfish project? The blue whiting project has been very successful in Killybegs. There may be other fish species that could be used for human or animal consumption. Some of the processing plants are examining new technologies for dealing with boarfish. Will the delegation give us an update on this and quota allocations for this area?

The development of aquaculture and added-value processing is an integral part of Food Harvest 2020. Is it an industry-led bottom-up approach demand for added-value processing or is it being driven by BIM? If it is a case of the former, are the resources available to meet the potential demand?

I know plans are at an advanced state for salmon farming in Galway Bay. What is the status of it? What is the view on the theories being put forward by objectors about sea lice? How does one balance the creation of jobs and meeting the Food Harvest 2020 targets with the environmental concerns of locals in Galway?

The recent announcement by the Minister for Transport, Tourism and Sport, Deputy Varadkar, and the Minister for Agriculture, Food and the Marine, Deputy Coveney, on vessel grants has to be welcomed as a significant step in the right direction. Unfortunately, it took a tragedy for it to occur but the grant-aid is still to be welcomed. Will it be rolled out through BIM? If so, will BIM advise us on this?

I have spoken to Údarás na Gaeltachta on seaweed harvesting and the Arramara plant in Galway. It is my understanding that 70,000 tonnes of seaweed would be harvested from Connemara to north Donegal. Can the delegation give us an idea of the potential tonnage? There seems to be a huge demand from China for Irish seaweed. Three products can be got from seaweed: the dried seaweed itself - which is exported, predominantly to China - and derivatives for use in facial products and food. We want to go more towards developing the food side because one gets more bang for one’s buck from this sector. I have met with companies that are interested in exploiting the seaweed resource and exporting the seaweed whole packed to China. What impact will that have on seaweed levels along the coast? Some of the companies working in this area already are concerned it might be over-exploited. Are there any controls in place? Do they need to be put in place? Should the National Parks and Wildlife Service, NPWS, the Marine Institute and BIM come up with guidelines to ensure the seaweed natural resource is not exploited cheaply for price and exported and that we do not lose out on the added-value end of things?

I am not sure if Mr. Whooley has any views on that, but controls need to be brought into that sector because if that does not occur, one could end up with a hugely valuable natural resource with many benefits being exploited for financial gain and the benefits being obtained by other jurisdictions outside our control. I thank the delegation for coming here. I am a great supporter of BIM and the work it does. This country and the fishing industry is better off because of the work BIM does. It is always nice to meet with its representatives and we wish them well in the future.

1:00 pm

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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I thank Mr. Whooley for his presentation and welcome his team here. In his presentation, he mentioned the reduction in staff. I think he said BIM is down to 125 people. How has that affected the roll-out of its project across the State? Could he give us an indication of the overall budget BIM has to work with? Has there been a reduction in the overall budget?

I am looking at the macro-economic background. Mr. Whooley says exports have increased by 13%. He gave a number of figures relating to the current market focus, including a figure of 67% for Europe. I am interested in this figure. Are there any specific areas in Europe where there is a greater emphasis or demand from?

I met with a co-operative society very recently. The produce in question was Tralee Bay oysters. It was a critical meeting attended by BIM representatives. Very unfairly, some of the people present were very antagonistic towards BIM or its representatives there and focused on issues that differed completely from the subject matter of the meeting. In respect of people involved in inshore fishing, be it lobster, crayfish, oysters or inshore trawling, the peak season is from the end of June to September. One might get €23 to €24 per kilo for lobsters earlier in the year and from September onwards, one will get something similar, which is a good price. This would be replicated all along the coast. It is mind-boggling in the sense that the overall costs have increased and continue to increase, be they diesel, insurance, maintenance or safety. I know people who could be hauling 600 pots and crew members possibly earning €55 or €60 a day for that. To be honest, it is slavery. It would make sense if one had an integrated approach that would, hopefully, be driven by BIM where one could store one's produce so one would have a good income and develop new markets outside the usual ones. What kind of work has BIM done on that and what type of budget does it have for it? Let us take the example of someone with 80,000, 90,000 or 100,000 lobsters over a ten-day period during the height of the season. Their market value, at €8 or €9 per kilo, is three times less than they get during the off-peak season, which is €24 per kilo. There is huge potential there.

Another aspect is a brand market. People are landing fish in their respective areas and the fish is entering the market but there is no local brand. Is any work being done in producing or encouraging a local brand market? For example, we have Galway Bay or Tralee Bay oysters.

Another issue that came up at that meeting was the cost of gaining entry to more lucrative markets, although they complained about the distance and travel costs relating to getting products to market, including the cost of air transport. If little things like that could be addressed and there was a sizeable or even a marginal increase in the price one gets for produce, it would make a difference with regard to sustainability. Mr. Whooley mentioned sustainability in his presentation. He said 11,000 people were employed in the sector, which in macro terms is not huge, but it is huge income for coastal communities which are completely dependent on it. It has also helped to sustain local coastal communities so they can continue to survive.

Mr. Whooley mentioned the safety aspect, which I welcome in light of the tragic loss of the Bolger brothers recently. As a result of a presentation given by the IFO, attended by Caitlin Ni Aodha, whose husband was lost at sea, I have been arguing for a type of beacon or personal locator device. Would it not make sense if that was made mandatory and fully grant aided? Many people fishing at the moment, particularly onshore fisherman, are only getting by day by day and are cutting corners. When I looked at the boat on which those three brothers were lost, the size of the boat was the first issue while the second issue was the freeboard over the water line. It was absolute suicide. Not a foot and a half of that boat was over the water with three men on it plus pots. They had lifejackets and were not detected and apparently, as I am only going by reports, they died of exposure. If they had that type of beacon or personal locator, they would still be alive. There is an onus on the Government and by extension, Government agencies to make safety measures like that mandatory and fully grant aid them. I would like to hear Mr. Whooley's comments on that.

In respect of discards and the time factor regarding the discard directive, I welcome the fact that BIM are out of the blocks on it, particularly when one is talking about juvenile fishing. All of that has been staring us in the face for a considerable period of time. This must be driven politically to make sure that becomes the reality. I would appreciate a comment from Mr. Whooley on that.

I do not think anybody from a coastal or west of Ireland community has not heard some lobby regarding the BIM Galway project on salmon farming. Could Mr. Whooley give us an update on it? How advanced or serious has the conversation with the communities that will be on the front line been? What kind of conversation and dialogue has taken place, particularly with people who have been involved in the industry, albeit with no drift netting? What are the expectations or hopes that drift netting will again become part of an income? When the legislation banning drift netting was introduced, I argued that it would have a huge impact on other sectors, which it has had, and take a nice portion of the livelihood of people in coastal communities. Deputy Harrington's community and my own would know about it quite well. It has done irreparable damage to the sustainability of incomes for people from those areas.

I thank BIM for its presentation. Now, more than ever, we need that integration between BIM and coastal communities, not only the four or five the witnesses mentioned but such communities as Doonbeg in Clare, Fenit, and up along the coast from Rossaveal north into Achill. That connection needs to be there. There are areas where improvements can happen, whether through marketing, added value or whatever, that can make that difference of sustainability.

1:10 pm

Photo of Susan O'KeeffeSusan O'Keeffe (Labour)
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Mr. Whooley spoke about the new approach to the farmed salmon project and the identification of the location. Are there other potential locations or is BIM fixing on that one to see how it works? Is it a pilot scheme, or how does BIM describe it? What are the prospects for other locations that might arise? Does BIM have others in mind for after this one kicks off? On the commercial investor, is there somebody in particular? What are the rules and regulations surrounding that investor? Is it a Europe-wide investor or an Irish investor, or does it matter? Mr. Whooley spoke about the future being niche as opposed to commodity. Could he expand on that? We know what it means, but what does it actually mean here? Does Mr. Whooley believe the fishing industry will change its profile in the next five to ten years? I understand what it means in English but I do not know what he means by it. Those are expressions we very often throw around but I am asking him to pinpoint that.

On BIM's relationship with the Department of the Environment, Community and Local Government, I have a case on my desk of somebody applying for a foreshore licence to harvest seaweed. The notification letter went in to the Department of the Environment, Community and Local Government six months ago and there has been no reply, despite constant requests for a response, whatever that might be. When BIM makes a presentation it tells us about the good things, and that is as it should be, in a way. Reality is often different. BIM does not want to come in here and give us a list of all the issues causing problems but sometimes we need a reality check. That is the kind of reality check we get. People are out there trying to do what BIM wants them to do, recognising a market. This person is waiting to go ahead and there has been no response from the Department. BIM is not the Department of the Environment, Community and Local Government, but the application was submitted from its offices and has been sitting somewhere for six months. I would like a response to that. Perhaps one of the witnesses could take it up with me. I am not putting the person's details on the record here. I am sure he or she is not the only one. My experience is that usually if there is one there are more.

Photo of Noel HarringtonNoel Harrington (Cork South West, Fine Gael)
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While I am not a member of this committee I am very pleased to have the opportunity to contribute. I welcome Mr. Whooley and his team. For anybody in a coastal community and who has an interest in sea fisheries, this is an exciting time and there is much change. There is not a townland in this country that is more than 60 miles from the sea. For an island nation, a maritime country, sea fisheries is one of the least understood industries in this country and that is reflected in debates in this House. It is the Cinderella of our natural resources and that is regrettable because it has the greatest potential for economic activity in areas where it is difficult to attract economic activity as we understand it. That is why BIM and its presentation of its annual report is so critical. It speaks for the future of the industry as BIM sees it.

BIM is one of the few organisations that genuinely speaks for the industry. We have seen this in the sub-committee the Chairman has established to examine inshore fisheries. Who speaks for the fishing industry in Ireland? We have seen how many different organisations suddenly spring up. Based on geography, in a country such as Ireland the number of producer organisations does not make sense. Mr. Whooley is familiar with this. The producer organisations should be based on the industry segments. For example, there should be separate producer organisations for pelagic, demersal, aquaculture, inshore and shellfish. We are too small to have geographically based producer organisations that compete for membership when they should come forward with a strategic vision for how they see their segment of the industry. People do not understand that the pelagic segment is as different to the demersal as poultry is to tillage in the agriculture industry.

When one makes comparisons, people always ask why the fishing industry is not like the farming industry, which lobbies with one voice. The fishermen are competing against each other for a common resource. There are no boundaries, title documents, gates or areas where one can or cannot go. It is highly competitive, technical and very difficult. In that context I very much welcome BIM's enthusiasm to champion, add value to and progress what it sees as the future of fishing in this country.

I particularly welcome the recent announcements on safety. That is completely underestimated. There is nobody in a coastal area who does not know somebody affected. A family member of mine was lost at sea and was never recovered, albeit in a different generation. We must start embracing the technology available. BIM will take that so far. The grant aid it has announced will be welcome. I do not fully agree with the idea that one should 100% grant-aid anything. There is 60% grant aid for small vessels and 40% grant aid for larger vessels. We should give the industry the buy-in. It is a very modest amount, a couple of hundred euro. It is €75 to get the personal flotation device and the personal locator beacon. We should give the skippers the opportunity to buy into it. We must change the mindset. If 50% of fishermen are going to comply, we must see 100%. When the seatbelt legislation came in people said they would not wear them, but it has happened, by and large. People wear seatbelts now and I expect the fishing industry will comply. At least if we cannot save lives, we will recover people. We must examine the Icelandic experience. I have heard the Minister say in a country with a huge maritime fleet they have had only one loss of life in several years. They have the training, the compliance, the attitude and the vessels. They compete. Income is not an issue. Their compliance is laudable and we should attain that standard.

Aquaculture offers major potential for job creation in coastal communities.

I know of small rural areas where large multinational companies work offshore and members of 50 or 60 families have not emigrated because of a sustainable and clean aquaculture industry. It is not without its critics or problems, but on balance it is a lifeline for coastal communities. If the regulatory environment is robust, which I believe it is, there is no reason we cannot aspire to having an aquaculture industry equal to that in Scotland or Norway. We are starting from a very low base and I see huge potential. I entirely support the aspirations of BIM to bring economic activity to these areas in consultation with communities, which is very important. A large aquaculture industry means a critical mass which provides not only offshore jobs but also onshore jobs in processing which is the real benefit of an aquaculture industry. These may be seasonal, but it could be planned so the work needs to be done 12 months a year. This would help supplement agricultural incomes in these areas, which are challenged, and would provide a lifeline for communities where too many people must leave to go to Australia, Canada and elsewhere.

I hate the idea of levies, but with regard to funding, has an industry-led levy been considered? I accept it is such a fragmented industry it would be difficult to impose or manage such a levy. BIM is a flag bearer for adding value to the industry and marketing it, and it aspires to achieve more for seafood, but funding is always an issue and meetings such as this are always helpful because the issue gets an airing. It is also helpful that BIM's reports are published and bring the issue into the public eye. Unfortunately the media do not pick up on maritime issues as much as I would like.

I am pleased to be able to contribute to this debate and I wish BIM the very best. I know it will not sit on its hands and will aspire to further technology and achievements and will have further consultation with the industry. All of us could do more to promote this natural resource. We do not need to look to the oil and gas industry for resources; we have a massive resource around our coast and it needs better co-ordination, promotion and information. The people of the country do not appreciate what we have. We are a tiny island off the west coast of the European Continent, which has its drawbacks, but most people who work along the coast do not see a barrier but a highway, a living and a resource, and this needs to be highlighted more and more.

1:20 pm

Photo of Andrew DoyleAndrew Doyle (Wicklow, Fine Gael)
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BIM is exiting the ice plant business. Will there be a replacement for this? Boarfish is a relatively newly discovered species. What is the total allowable catch? Is it set at what BIM considers to be a sustainable level? Has enough research being conducted on this fish? If we develop it to be more than fishmeal it will become very desired. Are we satisfied we will not run into overfishing very quickly, which would run down the stock?

Senator Ó Domhnaill apologises for leaving the meeting but he is on Seanad business and will read the transcripts.

Mr. Jason Whooley:

I thank the Chairman and the committee members for their contributions and questions. I will deal with the broader questions and the expert team to my left will answer questions according to subject. Senator Ó Domhnaill asked whether our development strategy was industry-led or top-down. It is a mixture of both. It is a traditional sector with a considerable range of expertise in various areas, and it is very important for an organisation such as ours to be out and about listening to people, hearing what they have to say, addressing their concerns and planning a way forward with the industry. With this comes an obligation or onus on an organisation such as BIM, as a development agency with resources at our disposal, to lead the industry forward and provide leadership. We take this role very seriously. We investigate and scan the wider environment from a business perspective and, on the basis of the trends we see internationally and monitoring what the competition is doing, we plan with the industry and for the industry. I would like to think this challenges both parties, with us being pulled by the industry in a certain direction and equally us trying to take the industry in a certain direction.

Senator O'Keeffe asked about niche versus commodity. Marketing language tends to get thrown around and it can be a bit glib from time to time. Where we see niche versus commodity is down almost at species level. We have a very successful scaled pelagic sector with herring, mackerel and such species being exported quite successfully to markets such as Egypt, Nigeria and Russia. The costs are good, and in a commodity business when the costs are right and of significant scale a margin can be made and this is where we are trying to focus. When we speak about niche it is with regard to the more traditional shellfish and whitefish species. In 2011 the whitefish market in Europe amounted to 15 million tonnes, worth €55 billion. Of this €55 billion, 62% was imported from outside Europe. A total of 89% of whitefish consumed in Europe was imported from outside. Species such as pangasius, tilapia and Nile perch are commodity species from low-cost countries which go to a market which, based on the figures, account for approximately 67% of our sales. If we try to compete with these species, as we are doing at present, in the longer term we will lose because their costs are far lower than ours. The differentiation we are speaking about is with regard to these species. We must market species such as haddock, whiting and cod at a higher level or through different channels than where the other species are headed because it would be a race to the bottom if we tried to compete. I hope this in some way explains the specifics.

Photo of Susan O'KeeffeSusan O'Keeffe (Labour)
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It is a challenge.

Mr. Jason Whooley:

Yes it is, but it is the specifics of what we discuss when we speak about niche markets.

The reduction in staff has been very difficult. Through early retirement and the loss of contract staff we lost top-class, highly qualified and highly experienced individuals and it has been a challenge for the organisation and for the management team to try to cope with this. We have tried to reorganise and have merged divisions. We have cut many of our costs and refocused or dropped services and taken on new ones with a view to addressing where the industry needs to go and also its demand for our services.

It has been a challenge. It continues to be a challenge but that is the nature of our economy now and public service management is at that juncture.

The Chairman wanted to know the total allowable catch for boarfish. The TAC is scientifically based. On an annual basis, similar to every other species, it will be subjected to scientific assessment. The TAC and our relative share of it will rise or fall according to the scientific advice. He is right. We do not want the species to be around for just 12 months or two years before disappearing. Sustainability is in the industry's interest and we promote it so that we have a long term future.

Senator Ó Domhnaill asked a question on sea lice, Deputy Martin Ferris asked for a update on farmed salmon, Senator Susan O'Keeffe wanted to know if there were more salmon locations and about the investors, and she also had a question on the Department of the Environment, Community and Local Government and a question on seaweed harvesting. I shall pass these questions, specifically those on salmon, to my colleague, Mr. Donal Maguire.

1:30 pm

Mr. Donal Maguire:

I thank the Chairman for the opportunity to attend and the members for their queries. The simplest thing to do is give an update on the Galway Bay salmon project and then I shall deal with the other issues.

As the committee will be aware from previous contributions, there has been an attempt to kick-start the upscaling of production from the organic certified Irish farmed salmon sector. As required under Food Harvest 2020, BIM has worked closely with its colleagues in the Marine Institute and brought forward a plan to locate and secure licences for various offshore locations. In doing so, we have relied heavily on the institute's expertise because it has the leading scientists in this area.

As Mr. Whooley mentioned in his presentation, we have used substantial work packages by the Marine Institute in our environmental impact study around the location. The location in Galway Bay was the first and will probably be the largest and most ambitious application that we are likely to have, simply because it is the largest body of water and shows the greatest potential for a large scale salmon farm.

In accordance with the Fisheries (Amendment) Act 1997, we forwarded an application with an environmental impact study to the aquaculture foreshore management division of the Department of Agriculture, Food and the Marine, which is the competent authority for licensing. The application went to both statutory and public consultation and the processes finished in mid-December.

We received a great number of submissions to which we have responded. All of the responses have been lodged with the Department. As an applicant, we must be careful how we treat the matter. Our understanding of the process is that the Department will have circulated all of the documentation to the relevant State experts and, in turn, will receive various appraisals and reports. We do not know whether we will have requests for further information or clarification or whether it will be deemed that the Department has sufficient information to make a recommendation to the Minister. He can accept the application as submitted and grant the licence, perhaps with modifications and special conditions, or he can decline the application. Whatever decision he makes is subject to appeal. An independent body called the Aquaculture Licences Appeals Board will, most likely, consider the application. I say that because virtually every salmon farm licensing application made over the past 20 or 30 years has required the services of the board. That would kick in if, 30 days after the Minister makes his decision and publishes it, a member of the public or an organisation wished to lodge an appeal. The Department is still considering the application and taking advice from various State experts and bodies and we await the outcome. As the applicant we do not know how long the process will take and will have to wait and see what happens.

We have had quite a number of very serious expressions of interest from investors in the event that we obtain a licence. All of the major global salmon farming players, together with a number of other consortiums, have expressed serious interest in being BIM tenants if and when a licence is granted. We are pretty confident that the commercial development will become a reality if and when we succeed in achieving the required licence.

With regard to locations, we are investigating locations on the River Lee and near Inishturk and Inishbofin off the Mayo coast. We are at the point where we are receiving further data packs from our colleagues in the Marine Institute and will be able to determine whether there are viable and suitable salmon farming sites in those locations. We do not know, as yet, whether the locations will be suitable. Obviously we will only submit an application if and when they do. We will be cautious and careful in that regard. I can say that even if there are suitable sites they will be smaller and not on the scale of Galway Bay.

Deputy Ferris expressed concern about communities. BIM has worked hard to meet everybody who has an interest or a query on the Galway Bay project and the subsequent projects. We have spent many evenings on the islands and have talked to island communities and the inshore fishing community all around Galway Bay. For our sins, we have also attended a number of meetings with angling interests that have been less friendly and civilised than the meetings that we have had elsewhere, but that is their position and point of view.

BIM will continue to work hard at trying to reassure people and put forward our position on the project. Based on the work packages given to us by the Marine Institute, the science tells us that the project can be brought forward without a significant environmental impact and would not displace employment in other sectors. We are confident that will be the case.

It is proposed to build the project over time. It would not instantly go into full production. There would be an opportunity to see how it developed and whether there were issues or problems as it went along. I hope that I have dealt with most of the questions about salmon farms. Let me know if I have forgotten anything.

A number of questions were asked about seaweed. First, I shall distinguish between seaweed aquaculture, which is the growing of seaweed, and seaweed harvesting or gathering. There is a long-established tradition of seaweed gathering along the west coast that is largely based around the species Ascophyllum nodosum. That is the species that Senator Ó Domhnaill referred to. Údarás na Gaeltachta has had a long-standing engagement with that species of seaweed. It tends to be dried, processed and used in nutraceuticals and animal feeds and in supplements for golf course greens, racehorses, and so on.

A new industry around Laminaria or kelp was also mentioned, which is probably what the Senator was talking about. I believe a licence for harvesting it in the Bantry area is about to be granted. The National Parks and Wildlife Service and the Department of the Environment, Community and Local Government have reservations about kelp harvesting in other locations. We should wait and see how the project goes.

Kelp grows lower down the shore and tends to be underwater all the time, so it is a different type of gathering than the intertidal gathering that is practised for Ascophyllum nodosum. BIM is most excited about, and most interested in, seaweed aquaculture, which is the project in Dingle that Mr. Whooley mentioned.

This is where we are creating new seaweed rather than harvesting existing seaweed resources. That is based around a species called Alaria esculenta. We have worked very hard with the promoters and other academic institutions so that we can now reliably produce this seaweed. It goes out on seeded ropes and long lines, quite similar to what members would be familiar with in the mussel industry. It produces a single high-value species which can be used for human consumption or it can be used for nutraceuticals or for veterinary products. It is a modest beginning but it is very exciting. This will be a big new area of activity.

In terms of the relationship with the Department of the Environment, Community and Local Government, perhaps we might talk to Senator O'Keeffe in the margins about that.

1:40 pm

Photo of Susan O'KeeffeSusan O'Keeffe (Labour)
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Yes. It is inexplicable. I am sure there are specific difficulties but I think the absence of a response is causing the biggest problem. People do not mind waiting if they know they are waiting. They do not want to think nobody is listening.

Mr. Donal Maguire:

We will discuss that in the margins.

Photo of Susan O'KeeffeSusan O'Keeffe (Labour)
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I thank Mr. Maguire.

Mr. Jason Whooley:

Deputy Martin Ferris asked a specific question on our budgets. I will ask Mr. Connie Kelleher to deal with that.

Mr. Connie Kelleher:

Over the past three years, our budgets have been pretty steadfast at around €17 million. In 2011, it was €16.738 million, in 2012, it was €17 million and this year, it went back slightly to €16.630 million. One could say they have been constant at around €17 million. Within that, the capital element has been pretty constant at €4 million. Our current element has also been pretty constant over that time.

We have managed to remain within budget all of the time and we have managed our resources better and more efficiently with fewer people. Greater reliance on technology has been a big help to us. We have fewer people, with more work, rather than less, being done more efficiently. We have been using automated approval systems and paperless systems. We have worked very closely with our parent Department, the Department of Agriculture, Food and Fisheries, sharing costs such as web hosting costs. We have been creative and inventive and we have upskilled. While self-praise is no praise, it is a great credit to the organisation that many people who were doing one job three or four years ago are now doing additional jobs. In my department and in the other departments, everybody has metamorphosed and has accepted the reality of a reduction in the headcount. As Mr. Whooley said, there has been quite a significant reduction in the headcount from 175 to 125. There are programmes we have not been able to do but there are others which we have taken on. We have used our skill and our productivity and efficiency are very good.

Budgets have been pretty constant. In terms of workload, I do not think the industry has suffered. If anything, we have taken on additional roles and covered them reasonably well. Technology has been a big part of what we have done and it has saved costs. There is more time for customers as people are not tied up dealing with back office work.

Photo of Andrew DoyleAndrew Doyle (Wicklow, Fine Gael)
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Deputy Martin Ferris asked a specific question on safety gear, which was also mentioned by Deputy Noel Harrington and Senator Brian Ó Domhnaill, who looked for more information on the safety announcement. Deputy Martin Ferris also asked a question on inshore fishing of lobster, the fluctuations in seasonality and pricing and how we can store lobster and what we have done in that regard.

Mr. Michael Keating:

No doubt the committee is well aware that on Monday last in Union Hall, the Minister for Agriculture, Food and Fisheries, Deputy Coveney, and the Minister for Transport, Tourism and Sport, Deputy Varadkar, announced a specific new measure on what has become a tragedy of the sea, namely, the number of people we have been losing. I do not think it is anything new as people have been lost at sea since time immemorial. However, when one sees tragedies that might otherwise be avoided, it requires a new approach. What was announced on Monday was a new approach involving two key components - the first being a training-based one, which I must admit is so important, and training specifically in the use of modern equipment. We will roll out the availability of a new lifejacket which will be fitted with a personal locator beacon. The tragedy we saw in the past month in Waterford highlighted the fact that fishermen might be alive in the sea for a period of time but then finally succumb to hypothermia. That new scheme is hugely important.

Alongside it, there will be a task force to look at the wider area of maritime safety in the fishing sector, which will be chaired by Mr. John Leech of Irish Water Safety. Deputy Martin Ferris hit the nail on the head in that one of the many things it will look at is stability. Tragically, we see small potting boats going out to collect pots but then turning upside-down. That type of tragedy can be avoided. There are many other aspects of onboard safety at which that committee will look. I understand the Minister, Deputy Coveney, wants a report by the end of the year. It will then be up to the Department and ourselves to implement that report.

There are, critically, two components. There is grant aid for the lifejackets, locator beacons, the autopilot alarm, which will alert somebody that the wheelhouse may be unattended, and electronic position-indicating radio beacons, which are the locator beacons fitted to the vessel, particularly to the smaller boats. If they were more widely used, some tragedies might be averted. There will also be grant aid for smaller items like wireless cut-off cords for the engine so that if one falls overboard, the boat does not steam away and leave one behind.

The grant aid will be at a new rate of 60% for the smaller vessels. It will be 40% for most boats but 60% for vessels under 12 m which do not tow gear. That is the maximum we are allowed to go under European legislation.

Deputy Martin Ferris raised the specific point of whether this equipment should be made mandatory. There is a dilemma here. If we make it mandatory, under existing European Union law, grant aid is no longer available. One must remove the grant aid. The strategy we have is, I suspect, a sensible one. We will make attendance at the one-day enhanced safety training scheme every five years a mandatory obligation. It will be €75 to attend the one-day training course. One will get a card, which will become mandatory. When one attends that course, one will be given the option of paying an extra €75 which will entitle one to the full safety equipment. Immediately, attendance at the course and the card-carrying fisherman become the obligatory element. When one next presents for certification with the Department of Transport, Tourism and Sport, carriage of the lifejackets then becomes mandatory. I hope that makes sense. By not immediately introducing a mandatory component on the lifejackets and personal locator beacons, we can continue to give maximum grant aid. We will phase in that process over the next three years. I hope that clarifies that point.

We have spent quite a lot of money over the years setting up lobster holding facilities. I agree that if one looks at the price of lobster over the course of a year, in July and August, when the season is at its height and the lobsters are most frequent, the prices collapse. If we could hold these animals and sell them at a more steady pace throughout the year, we would maximise the price. We have had success as far north as Malin Head, where there is a wonderful lobster holding facility. If there are specific projects that need to be brought to our attention, we have funds which can further help this sector.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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There is a new initiative, FLAG. I imagine it would come under that.

1:50 pm

Mr. Michael Keating:

That is the sort of project that could be funded through the fisheries local action group, which, while part of the European fisheries fund, is in essence a community-led local development approach. Ireland has been divided into six regions - east, south east, south west and so on - and these can fund projects such as this.

Photo of Andrew DoyleAndrew Doyle (Wicklow, Fine Gael)
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The Commissioner may announce Ireland's allocation from the fisheries fund soon. Next Thursday, the Minister will attend the committee to brief us on the CAP and the Common Fisheries Policy. For someone who does not know much about fishing, I have found today's discussion fascinating. Unfortunately, a vote was called in the Chamber and we will have to leave for that. Is there something else to deal with before we go?

Mr. Jason Whooley:

There are two issues I would like Mr. Buckley to address if possible - the question from Senator Ó Domhnaill on the position of the current project on boarfish and the question from Deputy Ferris on the cost of entry into new markets and how we are overcoming that cost.

Mr. Donal Buckley:

I will address the issue of boarfish first. We produce approximately 57,000 tonnes of boarfish, which is a very small fish. The issue with boarfish relates to the difficulty with processing because of its size and the fact that it is a scaly fish. We are taking a threefold approach to developing markets for boarfish. It is a delicious, nutritious fish that we want to make available. We are working in China to gain entry to human consumption markets there and have established a base in China with a company that will distribute it and build the market. The Chinese like whole fish and they eat everything.

We are also working at processing the fish. In that context, we are developing a new technology here, with a west of Ireland company, that will cut the head off, remove the gut and squeeze the flesh out. We can use the flesh in that form to produce products like fish fingers and nuggets and compete in those markets. We have a company which is a significant player lined up to take the product to market once the technology is approved. There is an exciting new market to be developed in these cases.

Photo of Martin FerrisMartin Ferris (Kerry North-West Limerick, Sinn Fein)
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Where is the company based?

Mr. Donal Buckley:

The technology company is based in Sligo and the process and marketing company is an Irish food company based in Ireland. It has been testing products such as nuggets and fish burgers with us. It is an all indigenous package.

We spoke about markets and what we are trying to do. The European market is sluggish and we all know the reasons for that. The Spanish market in particular is difficult. Traditionally, the Spanish market was a very good market for Irish shellfish, lobsters, crab and prawns. Now our strategy is to develop our Chinese market. Last year, we assisted four big companies to create a joint venture to take their product into the Chinese market. We created a joint venture because scale is essential because it is so costly to get into the market. One of these companies was a producer of lobster and crab and we linked it up with a processor. They and two others formed a joint venture hub, Ocean Jade. This is an interesting development because it takes us to a brand new market, taking the pressure off the need for our Spanish market. Spain will now have to lift prices to meet the cost of our product if it wants it. In China there is a super-wealthy new middle class and there is a great appetite for Irish seafood. This is the broad base of our strategy.

Photo of Andrew DoyleAndrew Doyle (Wicklow, Fine Gael)
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Thank you. That approach is reminiscent of something we have heard before from BIM about developing collaborative approaches and developing the critical mass. It is good to see that approach come to fruition in a specific project. I am sorry we have to conclude. I thank Mr. Whooley and all of his colleagues for a very informative meeting, following an annual report now a couple of months old. It has given us the opportunity to discuss the bigger picture and the direction the industry is taking. We appreciate that BIM representatives must be very careful about what they say, particularly with regard to the Galway Bay project, because of due process.

The joint committee adjourned at 2.35 p.m until 2 p.m. on Tuesday, 16 July 2013.