Ms Sinéad McPhillips:

I briefed the committee on the unfair trading practices in September. The directive is now at EU level. It is almost finalised and is subject to final legal scrubbing. The directive will come in and then there will be a two-year implementation timeframe. As there is much overlap between the draft directive on unfair trading practices and our existing grocery goods regulations, which come under the Department of Business, Enterprise and Innovation, we are setting up a working group with that Department to work through the issues and consider how the directive will be transposed into Irish law.

The output value of the beef sector at farm level in 2018 was almost €2.4 billion. That is also the figure for the total value of beef exports. It is just a coincidence.

Irish food is exported to over 180 countries around the world. We have market access for beef exports to 70 countries. The Department’s efforts in market access are focused on opening markets. There can significant barriers to trade. We must understand the requirements of the importing country and demonstrate that our standards meet them. This can involve a series of audit and inspection visits until that country is satisfied that we can be given market access. In the case of China, it was a long drawn-out process over many years, involving a range of people in the Department, industry, at farm level and Bord Bia. We could see the opportunity in the Chinese market. The Chinese consumer eats, on average, 5 kg to 6 kg of beef each year. In comparison, an Irish person consumes 19 kg. A small increase on the part of the Chinese consumer would mean significant additional demand. To date, we have exported 1,000 tonnes of beef to China. It is frozen boneless beef and not offal. I accept that this is small compared with the 290,000 tonnes we export to the UK. It is a start, however. We see significant opportunities in China. Bord Bia’s market insights and consumer research suggests there are significant growth opportunities in the Chinese market.

We are opening the door and then it is up to the industry to develop those opportunities. The reason we export 52% of our beef to the UK is because it is the best and the highest priced retail market in Europe. There are good geographical, social, cultural and economic reasons for being there. If the events around Brexit had not happened, we would be quite content with that market. Obviously, there is now a focus on expanding market access around the world, creating opportunities which may be taken up by industry, from year to year, depending on what the market situation is. While they may go elsewhere, our role is about opening the opportunity to more markets.

On payments not being linked to production, we made a policy decision regarding the 2003-2004 CAP reform that we would go for full decoupling of payments from production. Since then, direct payments under Pillar 1 and payments under the world development programme have not been based on payment per animal. On world development programme schemes, including BDGP, those payments must be justified. They must add value and there must be a clear benefit to an environmental or a public good from making a payment. That is obviously the trend which will continue with CAP reform.

Deputy Cahill referred to the CAP budget. One of the main strengths of the CAP in making the case for additional funding is to be seen to be meeting key demands from the EU consumer around environmental goods, protection of the landscape and of the rural economy. Being relevant to those priorities is the only way we will ensure the CAP budget is protected in the future.