Mr. Angus Woods:

I thank the Chairman and members for giving me the opportunity to present and discuss the IFA's submission on the livestock sector. As a livestock farmer, with suckler cows and sheep, I have first-hand knowledge of the impact of the loss of income and the crises experienced in the sector. I also deal on a daily basis with the anger and frustration of livestock farmers across the country who are working extremely hard but finding it impossible to make ends meet and pay their bills. I highlight, in particular, the financial crisis facing winter finishers who have sold cattle in recent months. They have already taken the full brunt of Brexit. Lots of people talk about Brexit happening in a few months' time, but the farmers in question have already taken the full brunt of it. Some winter finishers, particularly fatteners of young bulls, are facing financial ruin.

As the president, Mr. Healy, outlined, the IFA has calculated the losses incurred since last autumn at €100 million. They are directly related to Brexit. The Minister for Agriculture, Food and the Marine, Deputy Creed, and the Government must introduce a compensation package for the farmers affected. The Minister needs to act urgently. Again, we are asking members of the committee directly for their support for this proposal.

On the Common Agricultural Policy, the single biggest issue is the budget. Livestock farmers cannot afford any cut in their direct payments. Many lost out financially in the last round of CAP reforms when their payments per hectare were cut substantially owing to convergence. Under the current reform proposals, further convergence is proposed such that all payments per hectare would be brought up to at least 75% of the national average by 2027. The IFA estimates that the cost of this convergence would be about €30 million. We support the European Commission's proposals to increase payments per hectare for genuine farmers in receipt of below average payments. However, they must be funded through an increase in the CAP budget or the implementation of the EU genuine farmer definition. They cannot be funded by reduced payments per hectare for those in receipt of above average payments. Convergence cannot result in more farming enterprises being made unviable.

The EU Commission has proposed that Pillar 1 direct payments, go to genuine farmers. The IFA proposes that the genuine farmer concept be fully explored in the context of the need to target payments towards active farmers. A further issue to be evaluated in the context of defining the genuine farmer is the practice of farmers leasing out their entitlements, having exited farming.

The IFA proposes that the option of introducing coupled payments as part of the next CAP should be considered in the context of targeting support to active farmers in vulnerable sectors. The IFA supports the current Commission proposal on capping, however we believe leased-in entitlements should be excluded from the calculation and family and formal partnerships be factored in.

Targeted sectoral support for sucklers of €200 per cow, and €30 per ewe and a tillage per hectare payment are important, with environmental schemes with maximum payment of €10,000 per farm, with higher payments for designated lands. The areas of natural constraint, ANC scheme has an increased annual allocation of €300 million, ANCs should be allowed as part of the 40% environmental calculation requirement in Pillar 1 plus Pillar 2.

The targeted agricultural modernisation schemes, TAMS, investment scheme is for all sectors, with 70% for young farmers and 50% for all others. A key point is to minimise the leakage of funds to service providers. Many people think this is a great opportunity to extract funds from farmers. We need the reintroduction of installation aid for generational renewal and mainstreaming the land mobility service. It must be noted that closure or cuts to the various farm schemes over the years, such as REPS, AEOS and the suckler cow welfare scheme, and cuts to ANCs all have had a detrimental impact on livestock farm incomes.

The IFA proposes strong support for committed young farmers - national reserve, top up payments, BPS and TAMS, partnerships, land mobility service and taxation policy must be the focus in the next CAP

The suckler cow herd is of critical importance to the Irish beef sector but is under immense pressure at farm level due to the lack of profitability at farm level. The IFA commissioned Professor Thia Hennessy from UCC to report on the economic and societal importance of the suckler beef sector. At a previous meeting we presented the details of that report to this committee. I will again highlight some of the key issues on sucklers and IFA proposals.

A key aspect is that research has estimated that every €1 of direct payments to cattle farmers supports €4.28 of output in the wider economy. Suckler farmers contribute to wider societal sustainability, particularly as they are often located in marginal or economically disadvantaged areas, where their presence is vital to the social fabric and cultural capital.

The national suckler herd is of fundamental importance to Ireland’s reputation as a major exporter of high-quality prime beef. Cattle from the suckler herd generally have a superior grading profile and heavier weight for age resulting in higher saleable meat yield and higher value cuts.

The very difficult income situation on Irish suckler farms is unsustainable and is already resulting in individual farmers reducing animal numbers leading to a loss in beef output, export values and employment.

It is estimated that a 10% contraction in the suckler cow herd would lead to a loss in beef output of €145 million and a loss of total output in the economy of €305 million, furthermore over 2,000 jobs would also be lost.

The beef data genomic scheme, BDGP, which is worth €44 million per annum, to 24,200 suckler farmers got overly bogged down in unnecessary departmental bureaucracy. However, payments of €100 per cow on the first ten cows and €80 on the remainder provide important income support to the suckler sector.

Following a strong campaign by the IFA in 2018 to secure increased supports for sucklers, the Government introduced the beef environmental and efficiency pilot scheme, BEEP, worth €40 per cow in January 2019.

The IFA made proposals to the Food Wise meat sub group chaired by Michael Dowling, which recommended increased targeted supports for the suckler sector to the Food Wise High Level Implementation Committee, chaired by the Minister.

The group stressed its view that beef from the suckler herd is of critical importance for the international marketability of Irish beef abroad and for the health and viability of the rural economy in large parts of the country. IFA is committed to supporting our national suckler herd and the 67,500 full-time and part-time farmers involved in the enterprise.

The IFA has put proposals to the Government and others to provide additional targeted direct support for sucklers and a price premium for quality suckler beef. The proposal is for a targeted direct payment of €200 per cow, financed from a combination of national resources and CAP Pillar II funds. We are of the view that farmers should be rewarded for quality. Livestock farmers must be properly rewarded for quality in prices. In addition, retailers and factories applying additional market specifications must also pay additional price rewards. The IFA recommends an additional price premium for quality cattle from the suckler cow herd.

The quality of beef calves from the dairy herd needs to improve. An essential element will be the roll-out and uptake of the dairy beef index. The ICBF and Teagasc have a major role to play in leading the required change in policy and adopting the breeding strategy at co-op and farm level. The Teagasc policy aim must be to breed calves that meet market specifications. The IFA considers the Glanbia-Kepak Twenty20 Beef Club scheme announced last week to be much needed new thinking in the sector.It has consistently argued for more secure price contract type arrangements from the factories.

In the context of the major market challenge from Brexit, additional market access is a priority for the beef sector. In addition, more liberal access to some existing international markets and the removal of access restrictions for beef such as frozen, boneless or age under 30 months only, disease status, etc. are essential to expand access.

On branding and geographical indication, GI, status, the IFA has proposed that Bord Bia develop a strong brand for Irish beef that will return a price premium directly to producers to capture the benefits of Origin Green and the quality assurance sustainability scheme. In addition, the IFA has proposed a price premium for grass fed and suckler beef. Following an IFA initiative in Brussels with the European Commission, the IFA has held discussions with the Commission, the Department of Agriculture, Food and the Marine, Bord Bia and others on a proposal to seek GI status for Irish beef.

On carcase classification, trim and weights, theIFA has consistently highlighted farmers' concerns about the lack of proper controls and checking of carcase classification, trim and weights at meat plants. Following reports of inaccuracies in carcase classification, trim and weights at meat plants, the IFA has proposed that the Minister and the Department of Agriculture, Food and the Marine increase controls and strengthen inspections and penalties. The current departmental system of announced random checks is inadequate. In addition, the modern method of hanging the carcase has rendered the Department's checking system much less relevant. It is the responsibility of the Ministers for Agriculture, Food and the Marine and Business, Enterprise and Innovation to guarantee farmers that the carcase classification, trim and weights at meat plants are accurate. The IFA has proposed that there be a permanent Department of Agriculture, Food and the Marine presence at meat plants to monitor carcase trim, that the monitoring of and controls on carcase classification be increased to guarantee accuracy, that a proper appeals system be introduced and that classification images be made available to farmers. The IFA has proposed that farmers access to the kill line in meat plants for those who wish to observe their cattle being killed, classified, trimmed and weighed. It has proposed that improved technology and modern systems of cameras and lighting, having been fully tested and proved to increase accuracy in classification, be introduced in the meat plants.

On international trade deals, the IFA has consistently highlighted the threat to the Irish and EU beef sector from an EU-Mercosur trade deal. A Mercosur deal which would give substantial additional market access to the countries concerned would seriously damage the EU beef market and must be rejected by the European Union. The Mercosur countries fail to meet EU production standards on the key issues of traceability, animal health, food safety and the environment. The European Union must insist on all EU imports meeting full EU standards. In addition, the carbon footprint of Mercosur countries is four times that of Irish beef production and involves the destruction of the Amazon rainforests. In the context of the new challenges posed to the Irish and EU beef sector by Brexit, including the potential loss of a high priced market for 290,000 tonnes of beef, the IFA is proposing that the Irish Government and the European Union withdraw any offer of further access for beef in the Mercosur negotiations.

I thank committee members for their attention. We will be delighted to take questions or comments on our proposals.