Paul Connaughton (Galway East, Fine Gael) | Oireachtas source

I welcome the fact that this forum is being set up and that the Minister himself is chairing it. I imagine it is going to run along the lines of the beef forum or beef discussion groups, working with the relevant stakeholders in an attempt to make sure that when crises arise or issues come up within the industry, there is a way of fixing them quite quickly. I compliment Deputies Deasy and Creed, who left earlier, on the work they have done to bring this through to fruition. It is hugely important that before the milk quotas go, we have a plan. In any industry, things go up and down. As the Minister of State is well aware, six months ago the beef industry was on its knees and now all of a sudden we see beef prices are quite high. That is the cyclical nature of this industry and it is no different on the dairy side. We started this year with huge concerns over the price of milk. It has not come through just yet but there is a slight pressure on it so it is important that any forum set up to work with stakeholders has an ability to react quickly to those concerns.

There are two areas I would like to raise. One of them concerns what was discussed in the House earlier today, namely climate change. Whether we like to believe it or not, we have a commitment to addressing the issue of climate change in a serious way. That means impacting on the agricultural sector as well - it is a double edged sword. We cannot afford to let climate change get out of hand. One of the main reasons we are a successful country is our mild climate and grass growth many months of the year. We need to protect that - we do not need long droughts or excessive flooding. On the other hand, in reaching our commitments, we cannot shackle the agricultural sector. We have many farmers preparing to ramp up production, and we have to balance the two factors quite sensitively. If farmers want to invest money in their agricultural systems, their sheds and milking parlours, there is no point in then clamping down again on them. The reason for getting rid of the quotas was to allow those who had an ability to produce more to do so. In County Tipperary and all over the country there are people with the ability to ramp up production quickly and significantly. We have to be somewhat concerned about the climate change issue. It exists and needs to be addressed and it is to our eternal benefit if we do address it. However, we also have to be sure we do not shackle the farmers.

The second area concerns the fact that there is no point in producing more dairy unless we have a place to sell it. Our exports are at an all-time high, which is most welcome. However, we need to continue to be vigilant on where we are selling our product to. I recently returned from a trip to Vietnam with the Committee of Public Accounts to see how Irish aid is being spent. The Dáil and the people of Ireland would be very proud to know how their aid is being spent on the humanitarian side, but another area was trade. Vietnam is a country of some 91 million people with an economy that is starting to pick up, whose middle class is beginning to boom. They do not really have a taste for dairy just yet, but it is beginning to increase. This is a market we have to invest in. When one talks about Asia, it is very easy to think of China as it is by far the most populated country in the world and is growing all the time, and that is where most dairy products are going. However, Vietnam is in a region of 600 million people and we have to put more emphasis there.

We know Bord Bia is doing great work on behalf of the State in exporting our product abroad but is it properly resourced? I can stand corrected on this but I understand we only have one person in China. The one thing that definitely came over when we were in south east Asia was that they do not want to do business through e-mail or Skype. They want a presence on the ground and for people to familiarise themselves with the country and the products it wants. It takes time to build up that level of relationship. I want to see a situation where Bord Bia is staffed to the maximum level so that it has the potential to invest in these markets. When we start to do that we will be able to sell a lot more. We have some of the best food production companies here that are doing an outstanding job. While we can produce all the milk we want, we have to make sure we have a market for it.

As Deputy Deering suggested earlier, a small country like Ireland that is producing a lot of milk is completely contingent on exports and open to world prices. The one area we have to attempt to control is the input cost. If the price of fertiliser becomes excessive - it is becoming so - the margin at the bottom, which can keep a farmer inside the industry, is getting tighter and tighter. We are part of the European Union and the European Commission will have to take cognisance of this. We are losing all control of our input costs and it is going to have a huge impact on the way we sell our products abroad if there is no margin. It has the potential to put people out of business quite quickly.

Deputy O'Donovan referred to agricultural colleges, which are booming at the moment. Mountbellew is no different, and it shows where the agriculture sector is going. Mountbellew is going to start offering a diploma in dairy farming because of the demand for it. While the west might not have as many dairy farmers as the rest of the country, it shows that many young farmers see a future in the industry. We have the issue in Mountbellew Agricultural College - I will never fail to raise it during any agricultural debate we have - that it is not being properly staffed. It needs a long-term future.

This is a very welcome opportunity for the dairy sector. The abolition of quotas is something many farmers have been looking for and is a huge opportunity to build and promote rural Ireland in a serious way. We must be cognisant of the challenges and I would pray caution, particularly for younger farmers who are investing quite heavily, to make sure they have a very firm business plan, know exactly where they are investing and are not taking risks beyond their control.

We will increase production by nearly 50% and that is welcome, but we must work on where we are selling the product. We are doing very well on exports, food and drink are going very well, but let us invest in our semi-State bodies and Bord Bia and put people into all these emerging markets.

There will be large dividends if we establish ourselves in those markets. Countries such as New Zealand will say they will produce milk as well as us, but they will not. However, there is no point in Ireland talking about our great product unless the rest of the world knows about it. We need to invest in people on the ground. I can assure the Minister of State that if we do so, we will make the money back tenfold.

See this speech in context