Oireachtas Joint and Select Committees

Tuesday, 17 January 2017

Joint Oireachtas Committee on Agriculture, Food and the Marine

Common Agricultural Policy Reform: Discussion

4:00 pm

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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We will move on to the next issue, which is obviously linked to Brexit to a certain extent. The issue is Common Agricultural Policy, CAP, reform post-2020. While a copy of the professor's opening statement has been circulated to members of the committee, I ask him to address its key points before we revert to the members.

Professor Alan Matthews:

There are three parts to my opening statement. As this is the committee's first opportunity to begin to look at this issue, I thought it might be useful to highlight the timeline as I understand it.

We are aware that the Commission has indicated in its annual work programme that the Directorate General for Agriculture and Rural Development, DG AGRI, should “take forward work and consult widely on simplification and modernisation of the Common Agricultural Policy". DG AGRI seems to be taking this as an open-ended invitation to consult on the possible changes to the CAP in the period after 2020. It has promised a public consultation, which I understand may take place over a three-month period launched towards the end of February. Based on the responses to that, there then will be an impact analysis of the different options. The Commission will come forward with three, four or five different options and will look at the implications of those. Then, towards the end of the year, we might expect a communication setting out its preferred options and the reasons for its choice. There will obviously be reactions to that, including from the Council of Ministers and from the Parliament, which eventually, possibly in the spring of next year, would lead to legislative proposals from the Commission. As everyone is aware, there is a particular timing issue in that the current Parliament probably will have its last sittings in the spring of 2019 while the Commissioner will be there until October 2019. Whether there would be enough time for the co-decision process to allow any firm conclusion to the discussion that might begin next year is an open question. While there will be a lot of discussion, whether it will actually result in legislative changes is something which the committee might want to bear in mind.

Second, I will comment very generally on the types of issues I would expect to see raised in the public consultation and in the impact assessment. I have grouped these under the three headings we were familiar with from the last CAP reform. There certainly will be economic issues. Here I would expect discussion on measures to help farmers better manage price and market volatility, to strengthen the competitiveness of EU agriculture and to improve the position of farmers in the food chain. The Commissioner has promised to try to persuade his colleagues, particularly in the Directorate General for Competition, to come forward with proposals on that issue, but it might well be wrapped into a more general reform of the CAP.

We then have the environmental heading, which of course was a key change in the last CAP reform with the introduction of the greening payment. There is quite a discussion as to whether this has been an effective instrument to achieve environmental improvement and we will see some discussion on that. We will also see the importance of the climate agenda, both in mitigating greenhouse gas emissions and perhaps in looking at the role of agriculture in terms of sequestering carbon and contributing to renewable energy.

Then you have the social dimension, where we will see a focus on young farmers, generational renewal and more broadly, as part of the Juncker priorities, the creation of jobs and economic growth in rural areas. It will be a very broad-ranging public consultation and it will raise all the issues followed very closely by many members in the last CAP reform.

I will highlight some of the changes in the political context. The first is that, since the last reform, the EU has signed up to the UN sustainable development goals, SDGs, and the 2030 agenda for sustainable development, which includes climate. The Paris climate agreement can be seen as the first step in implementing the climate goal in those SDGs. The Commission is taking this very seriously. In the last reform we were trying to fit the CAP into the Europe 2020 strategy, which was the overarching strategy of the time. I think for 2030 it is very much these sustainable development goals. That will mean more emphasis on environmental issues than we have seen in the past. There is a concern, not least in the light of Brexit, to try to show that whatever the EU is doing contributes to EU added value and that it is not trying to replace activities and policies which member states themselves could better implement. It is a question of whether it is possible to demonstrate that what we do in agriculture is contributing to European added value and is not simply substituting for what member states do.

The Commissioner has made simplifying the CAP his main objective in his term of office. It is extremely difficult, because agriculture and land management is complicated. The committee is aware of that. We can have different views as to how successful simplification has been but it is certainly going to be a recurring motive in the next reform.

Then of course the fourth issue, which we have already touched on, is the budget and how much money may be available.

The final part of the statement was really just to draw the attention of the committee to a report which I had prepared for the European Parliament's Committee on Agriculture and Rural Development. It is one of three reports. The other two looked at the Common Market organisations and at rural development.

I was asked to talk about the future of direct payments. I summarised some of the conclusions from that report, which was designed and help the Committee on Agriculture and Rural Development to identify some of the key issues. We can take it from a rather conservative position, one where we roll over the existing CAP structure with its two pillars, the greening payment and the direct payments, and even there I think we will see a number of issues which were quite contentious on the previous occasion. These issues include the external convergence, which is the expectation of the newer member states that their payments will continue to increase up to the average level. This has implications for the internal convergence, which is the question as to whether we should have a uniform payment across all farms. This was very contentious in Ireland in the last reform. There was a link made between the internal convergence formula and the external convergence formula, so if one is changed in the next reform, we might expect the other to be changed. The question was asked whether the capping of payments, which really has had no serious impact, will be reviewed? Even taking a very conservative view, there are some quite contentious issues which I think will be addressed.

There are those who would like to go further. Some people point to what has been happening in the United States. In their last farm bill they actually eliminated direct payments. They were the first to introduce them, but they eliminated them and decided instead to put the money into what they call their farm safety net. This comprises two main policies. One is counter-cyclical price support and the other is crop insurance, which despite its name actually covers some livestock products too. I would not recommend taking the route of counter-cyclical payments. We could discuss whether that is a good idea or not. In terms of the broader issue of risk management and insurance, it is worth looking at whether that has the potential to help farmers to manage risk better. I am a little bit sceptical. I think that farmers prefer to self insure, to use their savings or to draw on bank credit and tax averaging schemes to manage variability. There may well be a role for strengthening risk management instruments. The Commission has emphasised in particular this income stabilisation tool, so maybe that is something which should be further pursued.

Some of the committee members may not be surprised to hear me say that, although I am extremely aware of the fact that direct payments are very important to many farmers, I have never been a great fan of them. Looking at it partly from a taxpayer point of view but also from a farmer's point of view, I find it hard to justify paying a decoupled area-based payment per hectare of land without any evidence of return. I realise it will be controversial, but I have suggested that we would be better off, in a sense, taking some of that money and putting it into more targeted payments where we set out some objectives we want to achieve. These could be environmental objectives, risk management objectives, improving competitiveness or helping farmers address the climate challenge. It is to have more targeted payments rather than these generalised area-based supports which benefit the larger farmers within the Union because it is paid on a per hectare basis, and the more hectares one has, the more support one gets. At the end of the statement I summarise some of the principles which I recognise would be quite controversial, but perhaps I will leave it at that, and I am happy to take any questions.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I thank the professor. He is right to say that this is our first foray into this particular area, but because it is feeding into the Brexit debate the two are linked.

Photo of Martin KennyMartin Kenny (Sligo-Leitrim, Sinn Fein)
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I thank Professor Matthews for a comprehensive report into CAP reform. On the last points made by the professor, certainly for many farmers in Ireland, the intensification of agriculture has meant that fewer farmers are farming the land. I have always felt that the Irish model, and to some extent the British model, where there is the family farm and livestock are free to roam and are grass fed, is unique. We have those advantages. I feel that in terms of an EU agricultural policy, every effort should be made to protect and enhance that, because it is a key thing. It is also what European consumers want. Whatever reform emerges should be focused on ensuring that emphasis is put on the smaller holdings, the family farm and that type of production unit.

I understand what Professor Matthews is saying regarding payments per hectare. It is hard to envisage anything that will work for the farmer that is not a payment per hectare. That is the problem we have. It would be interesting to tease that out. I understand that in CAP there is the environmental sector, the greening measures and all that stuff, which many farmers avail of. However, many farmers also find that the red tape that comes into it can cause a huge degree of frustration for them, because they feel they have to jump through many hoops to get a relatively small amount of money. Certainly where I come from, it pushes them into a position where they end up abandoning the farm, planting the land and stopping working it. It is a tragedy, because it is a permanent change of land use, and it means that that land will never be used for productive farming again, and there will never be a community living in that area again, because it is such a low labour intensive form of production. If CAP reform is to work from an Irish perspective, it has to be about delivering the maximum payments to the family farm and the farmer who is on the most marginal land. If we are going to try to do that, I would be interested in hearing the views of Professor Kelly as to how an alternative to hectare-based payments might work, because he said if it was not on a hectare basis, it could be more targeted. If it could work, I would hope that it would give the Irish farmer an advantage which he or she does not have at present.

Photo of Jackie CahillJackie Cahill (Tipperary, Fianna Fail)
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I thank Professor Matthews for his presentation. I have crossed swords with him before regarding his views on the single payment, and it will be no different on this occasion. This is the biggest challenge in terms of direct payments that we have faced as a country since the introduction of the MacSharry reforms. I would like to make a number of observations. We talk about what benefit it has for the country, but European consumers are paying less and less as a percentage of their disposable income for the food they consume. That is a serious issue that we have as European farmers. The reality is, without the single farm payment, the vast majority of our farmers would not be able to survive. With regard to farmers on marginal land, the truth is that all farmers are under pressure. There has to be some recognition in this reform of farmers who are earning their income from full-time farming.

We have a significant number of farmers who can survive without an off-farm income, but those who are farming full time will have to be recognised this time around. One can introduce and operate caps, but if there is not some recognition of off-farm income, it will be extremely unfair. That is something that has been overlooked when we have talked about caps and targeting payments at different areas. The full-time farmer will have to be recognised more in this reform.

I would like to ask Professor Matthews a number of questions about his view of various aspects of the arguments that will be made in the next few months. The cornerstone is that it is an historic payment dating back to the period 2000 to 2002. Will it be able to survive this round of negotiations? Should it survive? A lot of people who have entered the industry engage in completely different farming practices. That is a fundamental point and it is where we are starting from.

There is an ongoing review of areas of natural constraint, ANC, payments and how the second pillar of the Common Agricultural Policy, CAP, is to be protected. Will it be protected and what percentage of the budget will be devoted to it? It is a hugely significant payment for this country. Virtually three quarters of our land is in areas of natural constraint. What impact will the review have?

I seek the professor's view on a matter related to the budget. Some 38% of the EU budget is devoted to agriculture in the form of the CAP. However, with the British decision to leave the European Union and a European Parliament that does not have a friendly disposition towards the CAP, what is the professor's realistic expectation of the percentage that will be spent on the CAP following the review? Considering the external convergence from eastern European and the internal convergence at home, will there be virtual parity per hectare when the negotiations are concluded in 2020? What will be the economic consequences for the country?

I would like the professor to expand a little more on a point that was made in an earlier contribution. He criticised the changes made by the United States of America in eliminating farm payments, but he believes what has been introduced will not work in the medium to long term. As what happens in the United States has a habit of happening here half a decade later, I would like the professor to expand on why he thinks what has been done in the United States is not in the best interests of the industry there.

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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I thank Professor Matthews for his presentation and insights. I would like to focus on his perspective of what does and does not work under the current Common Agricultural Policy, CAP, from Ireland's point of view. If he was to start with a blank page in the morning in terms of what would be positive in the review of the CAP, how would he set it out and structure it? As pointed out by Deputies Jackie Cahill and Gino Kenny, a significant proportion of income, or almost all for farmers involved in some sectors, comes from farm payments. Therefore, the stakes are very high in terms of how much will be included in the budget and how it will be distributed. Unless it is maintained to a significant extent, it will sound the death knell for a number of family farms. It is crucial, therefore, that we achieve a good outcome. Starting with a blank page, how would the professor structure the CAP? What does he believe works and what does not?

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I thank the Deputies and ask Professor Matthews to address the points made.

Professor Alan Matthews:

Again, a wide range of issues have been raised. I thank the Deputies for their questions. I will make a preliminary statement.

Given that the direct payments are so important, particularly for beef and cereal farmers, I certainly hope changes would not take place overnight such that we would be thinking of what happened in New Zealand, for example. I will come back to Deputy Jackie Cahill's point about direct payments being the cornerstone of the MacSharry reforms, but it is hard to continue to find justification for direct payments. It would be better to plan for that change and try to look at what we might want to see put in place, rather than put our heads in the sand and simply say we have clearly benefited from these benefits in the past and want to hold onto them because clearly we do not want to give them up. I can completely understand this. I think we need to take into account the budgetary context. This is the first question that has been raised about what the impact might be on the budget, but I would not like to put a figure on it. I believe, however, that the budget will be smaller simply because I see the European Union being concerned about the other challenges of migration, security and, to some extent, job creation, although it can be argued that agriculture and the food industry will play a role in that regard.

The European Commission will come forward by the end of this year with its initial proposals in respect of the next multi-annual financial framework. Some voices argue that it should be brought forward sooner because if Brexit takes place in 2019, perhaps we will need a revised financial framework as and from 2020 rather than, as we now expect, 2021. There are suggestions we should simply roll over the existing medium-term budget because of the timing problem, with European Parliament elections due to take place in 2019. It may well be difficult to get it through before it breaks up.

People see value in the maintenance of the family farm and smaller farms. Recognising this, if we can try to quantify or identify that value, can we support the activities engaged in rather than the size of the farm? I am not a great fan of supporting farms simply because they are small. I think Deputy Jackie Cahill is absolutely right in that regard. Small farms differ enormously in terms of their income and many farmers have an outside income. That is one of the reasons I do not think capping direct payments would provide for greater equity because the income position of such farms is very different. Because they are small and less intensive, can we actually make payments to support their involvement in more extensive farming? I would see this as a targeted payment. I am not worried if a farm is small or large. If a farmer is farming more extensively and producing more - it could be bio-energy if engaged in forestry - that is something the public can recognise and would be willing to support, as opposed to giving him or her a payment per hectare without requiring a return, although I know that there are cross-compliance conditions attached.

There is not really any evident return to the taxpayer from that per-hectare payment. If the farmer is involved in a short supply chain, supplying the local farmers' market, for example, and we could support that directly, not the fact that the farmer is small but that he or she is doing something the consumer wants, I would see a value for payments. That is why I am a great supporter of the Pillar 2, which provides us with a framework. I would like to see it enlarged and strengthened because it gives us more flexibility to provide these targeted payments. I understand the reluctance to see land moving out of farming into forestry, which is probably the most likely land use but we do have a policy objective to increase the rate of planting. It has a role in helping us meet our climate targets. The planting carried out now is more environmentally sensitive than was the case in the past when there were acres of conifers. I can completely understand why people objected to that. I have walked in the forests of Denmark, which date from the 19th century when there was a replanting scheme. The German forests also date largely from the 19th century. They are replanted forests. I look forward to the day when we could have a larger forest stock. I realise there are different views on that but I am more positively inclined to see it as an option.

The key point is in the question about the decoupled payments. They were not initially decoupled, they were partially coupled under the MacSharry reform and were decoupled a decade later under the Fischler reform. They were introduced to compensate for that price reduction. We need to rethink the basis on which we are asking the taxpayer to continue to provide that transfer to farmers. We are maintaining land and landscape in difficult farming areas. I have absolutely no problem in supporting payments for areas under natural constraint. We are doing things for the environment, protecting biodiversity, habitats and so on, which is absolutely a clear case for support. That is the direction I would like to encourage people to think about moving. It will be more difficult to maintain the area payments. That is not to say that farm groups will not fight to do that.

Earlier, we discussed what UK agricultural policy might look like after Brexit. It will be interesting if the UK follows through on what many of us felt was likely to be the case, it is going to be an interesting case study to put it mildly, how farmers respond in a situation with lower support. There is a case that at least a fair proportion of the direct payments leak out of the sector. There is no doubt that conacre rents and the price of rented land are higher because people know there are direct payments they can access. I am pretty sure input costs are higher than they would be if we did not have the direct payments. There are ways in which the agricultural sector would automatically adjust to lower payments over time and given the space and time to do that.

Photo of Michelle MulherinMichelle Mulherin (Fine Gael)
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The advent of mega-cities is causing a migration problem - for example, in Dublin. I am from Mayo where, like Donegal and Sligo, the statistics show migration of people to the cities. In developed countries where the concept of the family farm has been lost, there are ranches and loss of population. In developing countries there is no regard for the farmer. I know there are issues for the farmer as producer, the price he gets in the food supply chain and the problems we have here. Much of the money given out in direct payments does not satisfy people. It just keeps them ticking along. We need to consider, in the larger global context, how to have viable communities in rural areas because people in such areas do not really want handouts. We always suffer from the problem of critical mass and it becomes part of a vicious circle. We lose more people and then we must ask whether it is worth investing in areas such as those to which I refer. There are many opportunities but support is required or else we will continue giving crumbs to farmers.

I am also concerned about rural development. As a country that has strong rural traditions, we could develop some formula that could be applied elsewhere because the massive loss to rural areas is a worldwide issue. Do we value them? People cannot live on fresh air and the CAP is intended to secure food supplies - there are also environmental concerns - but do we want more than that for rural areas where people do not want handouts? This is a much bigger question than just tinkering around with cuts here and there. For individuals on low incomes, those making no money apart from what they receive from direct payments or individuals who are losing money as a result of the price of commodities, a small cut per week is a major issue. We have a golden opportunity to try to arrive at a formula. I do not know if there is an appetite to do so, however. I can only see it going in the same direction. It will be more depressing to be a farmer. We will lose young people, a way of life and food quality and all our great ambitions will be dashed.

Much of the global political upheaval arises from too much emphasis on economy yet we cannot enjoy many of the pleasures, the leisure and lifestyle we have without economy but somehow people think we are bowing at the altar of our being economic units and we do not get the balance right. The CAP could provide an opportunity to inquire as to what is our vision for rural Ireland and to do something right in respect of it, rather than just giving people crumbs to keep them going until the next crisis. We seem to be always playing catch-up. We could do more and do something for our country, respect the cities and the rural areas. We need to take the pressure off the cities. They cannot cope. I do not know how they will cope on so many fronts.

Photo of Thomas PringleThomas Pringle (Donegal, Independent)
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I thank Professor Matthews. What is the rationale behind his recommendation that national co-financing should be required for all CAP expenditure? I was amused when he spoke about simplification of the CAP.

I find it very complicated and, supposedly, it has been simplified. It could go a long way yet before it is simplified.

Professor Matthews also said that decoupled direct payments should be phased out. I had thought decoupled payments were brought in because payments were previously tied to production, which led to overproduction, and that decoupled payments were positive. Why does he say they should be phased out?

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I will offer an observation from my experience. The opening point of CAP reform is not always where the end point is. We saw during the most recent CAP reform that the then Commissioner had very radical proposals but that the eventual outcome was totally different. We must bear that in mind. In addition, the main difference on this occasion will be the budget. It will determine exactly where we will go. Perhaps my observation is wrong but, in my opinion, the budget will probably be an indication of where we will go in future CAP reforms, even beyond the current one. There is continuous downward pressure on the budget. Professor Matthews made a point earlier about the condition of farmers in this country, what is coming down the line and the decrease in funding available. This may have a knock-on effect in a positive way. For example, as Professor Matthews rightly mentioned, the price of conacre, fertilisers and inputs is a huge issue in this country. There is no doubt that conacre has got out of control in recent years, possibly as a result of the cheque in the post that will come sooner rather than later. This is just an observation.

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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May I make one point before the Chairman goes back to the witness?

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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Yes.

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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We have discussed the challenges to the beef industry in the context of Brexit. Regarding CAP reform, the budget and how it might unfold and the experience in recent years whereby farmers have been producing beef at sale price, which does not cover the cost of production, I ask Professor Matthews to comment on the beef sector. In particular, if there is a reduction in the CAP and direct payments, how does he see this impacting on the beef sector in the future?

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I ask Professor Matthews to conclude in responding to those remarks.

Professor Alan Matthews:

Again, I thank the members for their questions. I will respond first to the question on the US policy and why I was not too enthusiastic, particularly about its countercyclical payment aspect. This is for a number of reasons. First, it would be a step back to relating support directly to production, from which we moved away. It would require support again to be linked to products. There would certainly be difficulties in fitting it into the EU budget structure, which, as we know, is rather inflexible because it is set for seven years, although there are ways of moving money between headings. It is not an easy structure in which to try to manage a countercyclical payment policy whereby one will, by definition, have a large expenditure in one or two years when prices are quite low and, when prices go back up again, zero expenditure. Managing that countercyclical payment in the context of a relatively inflexible EU budget would be a challenge. Furthermore, prices fluctuate because they are a signal indicating that farmers and consumers need to adjust. If prices go down, it means there is oversupply, and if we prevent that signal going to farmers by telling them they will get this guaranteed price in any case, we will simply shift the adjustment onto the rest of the world. There is an aspect here of our interest in developing countries which, I feel, also argues against countercyclical policies.

The other aspect of the farm safety net is, as I said, risk management, that is, helping farmers to manage risk. One of the issues on which we have some evidence here is that because in the past European agricultural policy provided much of this risk management through the market mechanisms - variable import levies, export subsidies, intervention, support and so on - it meant that private initiatives never developed to the same extent as they did in other countries, simply because we had these public support mechanisms in place. In the academic literature we refer to this as the public mechanisms crowding out the private initiatives. When the public mechanisms were slowly withdrawn, and as we became more market-oriented in our Common Market mechanisms, we were slow to see the emergence of private replacements. It is only this year, or perhaps last, in the dairy industry that co-ops are offering fixed-price contracts to farmers. This should have happened years ago as a way of sharing a risk. There are opportunities to try to consider more private initiatives, perhaps with the support of some public funding. As I said, I am still not fully convinced farmers will see this as a really attractive option in terms of buying insurance to stabilise their incomes. As I said earlier, they may prefer to continue to do this on an individual basis, but I am certainly open to the idea that we should put more effort into considering this through pilot schemes and trying to assess the appetite of farmers for enrolling in these kinds of income stabilisation measures. We could consider that part of the American system.

Clearly, the decoupled payments were a great improvement on what went before, and I am certainly not arguing that we should move back to the past. However, the next step is to try to argue that there is a case for making transfers to farmers, that they do provide services other than food and that they should be rewarded for this. It is a question of trying to see how we can target the payments. That is really the message I am trying to get across.

The issue relating to beef is difficult. People refer to the suckler cow herd as the national asset. I have difficulty seeing this as the case. It is clear that we will continue to produce beef and that we will have a dairy herd and beef coming from that herd. The suckler herd is one of the few options for farmers in more marginal areas. It is not a very efficient system, as we know. I worry about the argument that to break even and give oneself a margin of €200 per cow, we need a price of €4.75 per kilo for beef, which is equivalent to almost another subsidy of €200 per cow, which I see some people seeking, when the industry is already surviving simply on the basis of the payments. Therefore, to say that the future of the industry is to give another €200-per-cow subsidy is simply not the way forward. I am an economist, not a livestock expert. However, I am of the view that we probably need to go back and consider more extensive systems, which probably means larger farms - larger not necessarily in terms of economic size, but in terms of area - if our stocking rates are lower, and lower-cost systems. I do not see us getting a market price of €4.75 in the near future - not with Brexit and the way markets are going.

Photo of Jackie CahillJackie Cahill (Tipperary, Fianna Fail)
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Surely, however, markets go against low-cost systems. One must get cattle out under a certain age limit, which instils a cost into the system. To say that we can produce beef on a low-cost basis is not really practical or what the consumer is demanding.

Professor Alan Matthews:

I understand the point completely but the other option of assuming that somehow we will get that very high market price does not seem to be realistic either.

Photo of Jackie CahillJackie Cahill (Tipperary, Fianna Fail)
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The other option is not realistic either, with respect.

Professor Alan Matthews:

Yes. This is something for the relevant people in Teagasc to examine with respect to whether there are systems that would allow us to be perhaps more extensive and yet meet those market demands.

Photo of Martin KennyMartin Kenny (Sligo-Leitrim, Sinn Fein)
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Is it not the case that our unique selling point is that we do not produce beef from that type of system but that we produce grass-fed beef from family farms? We are not competing with the huge feedlots that they have in Latin America and other places. We are producing a much superior product from the perspective of what the consumer wants. It is a question of marketing more than anything else. Would the beef produced by our system not be able to demand the higher price we need to get?

Professor Alan Matthews:

If we consider the Origin Green efforts of Bord Bia and so on, they try to emphasise that. Deputy Cahill probably knows the figures better than I do, but one of the difficulties is that about 60% of the carcass ends up as mincemeat and it is very difficult to differentiate. We think of beef as the steak that one buys, but a large proportion of it ends up in a fairly undifferentiated product, so it is difficult to differentiate. I agree that to the extent we can do that, it makes sense to do so.

Photo of Pat DeeringPat Deering (Carlow-Kilkenny, Fine Gael)
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I thank Professor Matthews and the members for their contributions. The discussion on the two presentations has been thought provoking, and while the discussion on Brexit will be ongoing, our discussion on Common Agricultural Policy, CAP, reform is the beginning of a long discussion that will take place over the next period. I thank Professor Matthews for giving of his time today to attend the meeting and for making those very worthwhile presentations.

The joint committee adjourned at 6.23 p.m. until 4 p.m. on Tuesday, 24 January 2017.