Simon Coveney (Cork South Central, Fine Gael)

I do not need to read a script as I am very familiar with the sugar industry as it was and, I hope, as it will be in future. Last summer I had two professional feasibility studies done on the building of a factory and relaunching a sugar industry in Ireland. This would be a sugar and ethanol industry. The groups which financed and drew up the feasibility studies did a good job in progressing a serious discussion on this issue.

For the past 18 months the European Union has experienced a serious shortage of sugar. At one stage, the price of processed sugar reached approximately €800 per tonne or twice the level at which it stood when Ireland exited the sugar business at the time of the EU reform of sugar policy which has been subsequently proved to be flawed. The European Union's sugar quota system will remain in place until 2015 and Ireland has been compensated for staying out of the sugar business until that year. The Commission is proposing to abolish sugar quota from 2015 onwards, which would allow Ireland to recommence processing sugar if it was commercially viable to do so. The rule of thumb, as the feasibility studies show, is that the price of sugar on the European or global market needs to exceed €500 per tonne for processing sugar in Ireland again to be a commercially viable proposition. We would also need to invest €300 million or €400 million to build a processing plant. If the price were to fall below €500 per tonne, the numbers would be difficult to stack up.

It is important that we do not provide subsidies to start up the sugar industry again only to find we must continue to subsidise it to keep it alive. As someone who delivered substantial amounts of sugar to a former factory in Mallow, I hope we will re-establish a sugar industry in this country, but it must be a commercially sustainable business. I believe this to be a strong likelihood and I am strongly supportive of the proposals. The industry, however, must stand on its own two feet commercially.

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