Oireachtas Joint and Select Committees

Tuesday, 27 September 2016

Joint Oireachtas Committee on Agriculture, Food and the Marine

Estimates for Public Services 2016: Vote 30 - Department of Agriculture, Food and the Marine

5:00 pm

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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They are turned around very quickly. There is no undue delay at all. We have provision made for these payments and the systems are up and running. We want to get the money out because it suits us. However, only 100 applications have come in.

Some people have been approved. While I acknowledge there have been difficulties in all sectors, many farmers, rightly and understandably, have decided that once they have an approval, they will hold on to that because they do not have the cash flow to manage repayments. It raises the question as to how we might better track approvals with work being carried out because in terms of financial management it is a challenge.

On ANC, areas of natural constraint scheme, payments, there is a provision in the programme for Government for €25 million but that is a 2018 payment. The €25 million this year is a sheep payment. I know there is ground to be made up in terms of cuts made in disadvantaged payments in recent and not-so recent years. Deputy Jackie Cahill will have to acknowledge we all have to share the blame for that. There is a programme to undo that but it will be in 2018.

To an extent, there is some Brexit fatigue setting in, particularly about the uncertainty around it and how we will deal with it. The Department has been extremely active in this area. We have established a dedicated unit in the Department, along with a stakeholders’ forum to include agrifood, seafood and the fishing industry representatives to allow them articulate their specific concerns. I have met with my Northern Ireland counterpart on three occasions and I will meet with my UK counterpart, Andrea Leadsom, in October. In October, I will also meet the UK multiples which are significant purchasers of Irish agricultural product, totalling €5.1 billion in exports. Although Britain is leaving the European Union, we are not surrendering any shelf space. We do not know the terms under which it will depart. However, we are anxious to protect the markets we have. We believe we have a good case to make in working with the UK because it has a reciprocal trade arrangement with us, exporting €3.8 billion in agrifood services to here. We believe we can make friends there.

We are also working on the other side in creating the political awareness across Europe. The Taoiseach has met the new UK Prime Minister, Theresa May, the French President, François Hollande, and the German Chancellor, Angela Merkel, to create the political awareness of our specific dependency. Due to this high level of dependency, the quest for other markets is a continuous challenge. Live exports are obviously an important safety valve. What the Department can do in that regard is open the markets. We have succeeded in opening the live export market to Turkey.

We hope that significant numbers of lighter cattle would begin to move, which would put some floor on the weanling trade for the back end of this year.

As well as that, we are looking at other market opportunities. The Minister of State, Deputy Doyle, and I visited China, Vietnam, Singapore and South Korea along with about 30 agrifood and seafood companies looking for new export opportunities. Obviously, the big prize in this regard is opening the Chinese market for beef. We have cleared one hurdle in respect of the Chinese Government lifting the BSE ban but we must progress other issues, and I had a series of meetings about that. We continue to look intensively for new markets. Bord Bia is a significant player and is extremely active in this regard. It opened a new office in Singapore recently because south-east Asia is identified in Food Wise 2025 as a powerful emerging market with significant potential for us.

I will give the committee an example of how significant it could be. Retail food sales in China, such as those in supermarkets, were €750 billion in 2015. It is projected that growth will reach €1 trillion by 2020. Exports to China, which has very quickly become our second biggest export destination, are worth about €640 million. It is our second biggest export destination for dairy and pork products. We are a very significant exporter of infant formula to three or four very significant players in the market and we are the world's leading manufacturer of infant formula. There is a significant growth opportunity in the market with the lifting of the one-child policy in China. We are always out there looking for new market opportunities.

In fairness to Bord Bia, I would say that it has been a trailblazer in this regard, and I acknowledge the role of Mr. Aidan Cotter and his staff, who are small in number. We work through the embassy network, and Bord Bia and Enterprise Ireland work together because if we do not pool our resources, we will not have as big a punch. From what I saw in south-east Asia, it is a very slick and interconnected operation between the diplomatic offensive that is necessary, the sales offensive that is necessary and the technical stuff, which people in my Department do all the time. In that context, if members wanted to get a handle on that, I am sure my Department officials would be very willing to come in and give them an overview, which they did in the beef forum and other fora, regarding what they do about market access. It is a phenomenally active sector in the Department and we work continuously at it.

We open markets and it is then up to the trade to step into the breach. We succeeded in opening the US market for beef for grinding. When I arrived in the Department on 6 May, the meat industry was continually knocking on the door about that issue. The market has been opened, the industry must do its bit and we hope it will avail of some of those opportunities.

In respect of the boats-----