Ms Tara McCarthy:

There is already a sophisticated producer group model in the mushroom industry. We engage significantly with the producer groups to co-ordinate their marketing. This allows us to draw down funds with regard to European promotions. These funds are then matched because there is then an industry funding group. We are very comfortable working with producer groups. We actively co-ordinate or help different sectors to look at that model.

We have a slightly different remit within horticulture because of the legacy of Bord Glas. We have a stronger producer responsibility in that sector than we do in co-ordinating the type of activity mentioned. We endorse it as a strong model. It allows smaller producers to bring scale to their offering, prepare themselves to receive market messaging back and co-ordinate funding. As an example, while helping producer groupings in horticulture prepare for Brexit, we were able to introduce the concept of lean production to them in the form of a pilot. Those groups could then explore that idea within their own infrastructures to get that best practice model accelerated into their businesses. We strongly endorse that model going forward. I thank the Senator for the question.

Vertical integration is a very different business model regarding the cashflow funding involved. That is also the case in respect of Ireland's business model regarding land usage, as well as the infrastructure associated with vertical integration, as opposed to family farms and our grass-based production system. Pigmeat and poultry are intensive industries and our beef industry is not closely aligned with those models. There has been closer co-operation in the context of contract suppliers with different beef producers. In that instance, production models have been piloted and investigated. The Kepak KK Beef Club comes to mind, as well as the new 2020 model that Glanbia and Kepak are exploring. While that is not absolute vertical integration, it does seek a further alignment from start to finish and to send much clearer messages. There is a strong structure within the beef industry, which largely involves family farms and that is another factor in the fragmented nature of that industry as well. The working capital needed to finance the number of years involved would also be different from the speed to market in the poultry industry. It is a very different industry structure. Vertical integration exists in the beef industry in the United States but it is based on feedlots, rather than the grass-based extensive production we have in Ireland.