Mr. Phil Hogan:

In answer to Deputy Ferris's question, if the BSE situation remains as it is, with one isolated case, I do not foresee a difficulty regarding our disease status or any impact on our export potential. There are always a few isolated cases throughout the European Union and as long as there is not a significant number in any region or location, it should be okay. It is an anxious time for the industry as we wait for results to come back. It is hoped that in the next day or two the Minister for Agriculture, Food and the Marine will be able to get those results and clarify the position. Based on my knowledge of matters in Ireland, I am positive about the outcome.

Fertiliser prices are linked to gas rather than oil, unfortunately. There is evidence in recent weeks of a reduction in fertiliser prices for the first time as old stock is eliminated and new stock comes in. There is always a temptation on the part of people who have bought early to hold the price as far as they can, even though there is an unanswerable case for a reduction in prices. We continue to make representations and to highlight the issue to the Commissioner for Competition because this is the only area where we might be able to get some traction. The fertiliser industry had difficulties in 2004 when evidence was produced to show there was collusion in the marketplace to keep prices high and it was fined, so I do not think the industry wants to go down that road again and be the subject of an investigation that might lead to a sanction. Its participants are more mindful of making some moves in this regard and I have seen some evidence in recent weeks that they are starting to move, albeit that they could do better than what they have offered so far. It is tied up with the Russian gas situation.

Senator O'Neill mentioned the Russian ban. In spite of the Russian ban and an embargo of nine months, total agricultural food exports in the EU to third countries increased by 5% in value between August 2014 and April 2015 compared with the same period in the previous year. In April 2015, EU agrifood exports to third countries increased by 10% compared with the same month in 2014. This result is partly down to the weakening of the euro against other currencies but it is also down to the more aggressive promotion and marketing of the European Union in third countries, particularly China and the United States. Overall European Union agrifood exports to Russia over the period decreased from €8.6 billion to €5 billion, which is a reduction of 42%. We were able, however, to increase sales to some markets in the Far East, for example, of pigmeat to the Philippines. Exports to South Korea went up by 32% and to Hong Kong by 27%. China is now the second export destination for European Union products and we were up by 26% there and 64% in the month of April 2015 compared with the same month the previous year. We have also reopened live cattle exports to Turkey, which is producing some of the additional competition in the beef trade. Our agrifood exports to Turkey went up by 45% in the month of April 2015. We are making a lot of progress and these figures give a significant indication that other markets are being secured.

Senator O'Neill and Deputy Deering raised issues regarding the food chain, which is a critically important matter I have highlighted on a number of occasions. It is the Commissioner for the Internal Market, Industry, Entrepreneurship and SMEs, Ms Biekowska, who is in charge of the regulatory side of this matter, and I will continue to get the evidence to assist her to do something to ensure the producer gets a fair price in an open and transparent way vis-à-visother actors in the food chain. We are examining what is happening in the UK under the groceries adjudicator and in Spain where they have a similar type of system. At the end of this year we will have carried out an evaluation of what these two countries are doing in the food chain and we will also have the benefit of a report by Mairead McGuinness, MEP, who is doing a report for the European Parliament committee. In spring 2016 we will decide what action is necessary and whether that includes European legislation or a European-wide framework for fairness to the producer in the food chain, because if one does not have a producer one does not have a product.

Inspections are a contentious but hugely important issue. As part of the simplification of the Common Agricultural Policy I am looking at this area very carefully to see what we can do, especially for smaller producers and small farmers. The disproportionate penalties for small farmers are not fair and need to be examined very carefully, which I am doing. A farmers' charter has been agreed in the past 24 hours between the Department of Agriculture, Food and the Marine and stakeholders, and it will be interesting to see its contents and how it will feed into the yellow card system or whatever system we use for inspections. I agree with speakers who said too much bureaucracy was attached to the CAP, but when one considers that the legislators, the Council of Ministers and the European Parliament, had 8,000 amendments during the course of the 2013 discussions, this can hardly make it simple. I am then expected to resolve these issues.

Deputy Deering asked about the superlevy. The Minister, Deputy Coveney, made an effort last July in the Agriculture and Fisheries Council to bring about a soft landing, such as with a butterfat adjustment, but it failed because there was very little support from other member states who had abided by the rules while we were one of the countries that did not. In typical Irish farmer fashion, we were afraid to miss out on something so farmers decided to put their cows in calf in 2013 and then wondered why they had a superlevy in 2014 and 2015. They produced the milk and they knew what they were doing but they have now paid €69 million in a superlevy. All I could do was to get it paid in instalments over a three-year period, interest free. That is the best I could have done.

On generational renewal, member states and Ministers make choices on reserves and the choices are a matter for the member state. This also applies to the ratio of old to young farmers so the Deputy will have to speak to the Minister, Deputy Coveney, about that.

Generational renewal is hugely important and we are certainly anxious to promote financial products, which we have done today in the convention centre. We are rolling out a new financial instrument that will give low-interest loans for longer periods of time to younger farmers taking over who need some capital investment. So a farmer could get money at approximately 3% over a 15 or 20-year period for various measures on their farm in terms of capital investment.