Mr. Cormac Healy:

We were asked about consumer spending in the UK and a possible no-deal scenario. We are all living with a pandemic and the impacts that has had on segments of the market, particularly food service. A no-deal scenario that causes major economic difficulties for everyone on both sides, in the UK and in EU member states, obviously will have an impact on disposable incomes. We will have other issues with even trying to get in there in a no-deal scenario. We have already seen a significant consumer shift towards purchasing increased volumes of mince. Mince now accounts for over 50% of all the meat sold through retail and consumed in the UK. I do not envisage a significant shift in the types of cuts. There will be a substantial volume of mince, rounds on a periodic basis and steak cuts hopefully throughout the year, but particularly during the summer.

What should we do when faced with lower consumer spending? We constantly look at diversifying markets. Our future is still strongly based on trying to hold on to the UK market, service established EU markets and wherever possible broaden our horizon on international markets. That work has been ongoing and some of it ties in with the question from Deputy Fitzmaurice on China. My real disappointment is the suspension of the meat plants with China.

We are working with the Department to try to have that lifted. It was developing. Any new market will take time to build up, to find out what it is they actually want and where is the sweet spot. Progress was being made there but we have been hit since May this year with a suspension that has not yet been lifted. Apart from the immediate situation of that product not going there, it also raises vulnerabilities and questions in the market as to the security of the supply. It puts us out of the market when we are trying to build our position. There is disappointment at the fact that has not yet been resolved and that we are not back in there, and we certainly need it now and in the new year.

On the wider diversification piece, we are looking at markets such as South Korea, Thailand and so on, but they are extremely time-consuming and slow in terms of progress because of veterinary issues and agreement of protocols. We have to continue working on them.

The Deputy raised the issue of Bord Bia. As I said, our position is to try to hold on to market share in the UK. It is one of the best beef markets. It is a deficit market and it has to be the objective in terms of anything we do. We continue to see that it is where work should be concentrated in terms of Bord Bia working in the UK, as well as working in established EU markets and building our premium level of penetration in EU markets. Then, wherever we can, we should try to build a presence in international markets. That is where we want to see the work continuing to focus.

Around the calf situation and whether the industry had looked at veal, I do not think it is an area where we can develop. There are a number of veal producers in Europe but it is quite limited, although the Dutch in particular are seen as a major exporter of veal around Europe. It is not something where we can necessarily build up a position overnight, or in any kind of medium term. Our strong point is the traditional, mature, grass-fed, steer heifer beef. I do not see it. Some elements have been tried over the years but I do not see it as a position for our member companies to go to. It does not seem to be on their horizon. Some efforts have been made at it, but it is not an area where we are going to make substantial ground.

On the dairy-beef piece, it is about being able to do whatever possible in terms of the breeding, so the product coming off the dairy herd is as market-suitable as possible. The FTA debate is more for some of my dairy colleagues. Deputy Fitzmaurice referred to “a lot of cattle” going North. I do not have the specific figures but while there has certainly been an increase in the number of cattle going North, it is not big numbers either. If we process 1.7 million cattle here, the increase in the number going there has been very small in that overall context.

I am not sure that, across the UK, whether in Great Britain or Northern Ireland, there are major plans for growth in output. I have not heard significant talk about it. As a market, across a wide range of food areas, they continue to be deficit suppliers despite having a very good domestic market and a 60 million-plus population, so there is still that prize there, hopefully, to be played for. That is why I said our objective has to be to continue to focus on the UK and holding our position there.

The Deputy raised the point about the EU level and talking to people over there. Certainly, we have been doing that from the get-go. One particular point, which he has probably heard made previously, was to highlight the impact of taking the UK market out of the European beef market. The EU-28 beef market, as it is today, is 103% self-sufficient, so it is a market close to balance with a little bit of extra that is being exported. If the UK is taken out of that, the EU-27 beef market on 1 January would be 116% self-sufficient. That is a big surplus and it is a problem. The point we have made is not only on the impact of Brexit, but also that it is an impact for the entire EU market. The problem is not just about Ireland and is not going to stay in Ireland.

In terms of fixes or interventions, which the Deputy asked about, we do not believe the likes of beef intervention or aids to private storage, APS, if I take the question as being on that, are appropriate mechanisms. If our objective is to try to continue to keep beef going into the UK market, and to serve the customers that have been built up in whatever way we can, then something like intervention or APS does the exact opposite of that because it takes the product out. It might seem like it is a solution in that it takes a surplus out, but we have thrown the UK market wide open to competitors from South America and elsewhere to come in on it. We do not believe that those traditional interventions that have been available from Brussels are the solution.