Simon Coveney (Cork South Central, Fine Gael) | Oireachtas source

I congratulate the new President of the Irish Farmers Association, IFA, Joe Healy. Cohesive, strong and united farming organisations are very important to the representation of Irish farming interests. I consider the IFA to be very important. It has been through a difficult period and now has new leadership following an election. I wish Joe Healy well in the challenges he will face and I look forward to working with him, if I have the privilege of being Minister for Agriculture, Food and the Marine in the future.

As Members are aware, the agrifood sector has performed strongly in recent years despite very difficult economic circumstances, with exports reaching an estimated €10.83 billion in 2015, an increase of more than 50% since 2009. However, price volatility has been an increasing feature of agricultural markets in recent times. The Department has introduced several measures to support farmers in this context, including a volatility package agreed by the Agriculture Council in September for the dairy and pigmeat sectors which was matched by national funding, making a package of €27 million. The extension of income averaging from three to five years in budget 2015 was also aimed at responding to these challenges. The Rural Development Programme 2014-2020 is a vital support through farm investment, agri-environment schemes and knowledge transfer schemes, as well as many other support programmes, and is worth approximately €4 billion to the Irish farming sector.

The Department also continues to explore additional funding mechanisms for the agrifood sector. Since its launch, the Strategic Banking Corporation of Ireland, SBCI, has made 4,619 loans amounting to €172 million drawn down by small and medium enterprises, SMEs, and 26% of all the lending through that fund has gone to the agriculture and agrifood sector. In March, the Ireland Strategic Investment Fund, ISIF, Glanbia, Rabobank and Finance Ireland announced the creation of a new €100 million Glanbia milkflex fund which will offer flexible, competitively priced loans to Glanbia milk suppliers with loan repayments which can vary according to movements in milk price and season. I would like to see that kind of thinking, resulting in new financial products, coming from other banks to make sure that opportunity, in terms of the flexibility and design of farming and farming income linked to repayment profiles, is available to dairy farmers in other parts of the country, but also in other agricultural sectors. Financial instruments are also being considered for inclusion in the rural development programme.

Turning to recent developments in schemes being rolled out and payments to farmers, the two main direct payment schemes delivered under the Common Agricultural Policy, CAP, are the areas of natural constraint, ANC, scheme and the basic payment scheme, BPS. To date, payments of over €203 million have been made to 95,849 applicants under the ANC scheme, which many farmers would know as the disadvantaged area payment scheme. Ireland is among the earliest to pay the BPS in the European Union and commenced payments on 16 October 2015. To date, 125,676 farmers have received payments totalling €1.144 billion. This covers over 99% of applicants. I do not think any other country in Europe has that record. In particular, a significant percentage of farmers are still unpaid in our closest neighbour. Preparations for the 2016 ANC and BPS are well under way and the closing date for these schemes is 16 May.

I urge all farmers to apply as soon as possible and, where practicable, to avail of the online facility. It is much easier for us to get payments out quickly if we receive applications online. That is why we are encouraging farmers to use the facility. We accept that some farmers will have difficulty in doing so and we will, of course, accept paper applications.

During 2015, six new schemes were announced under the targeted agricultural measures schemes, TAMS. The second tranche for TAMS II closed on 25 March and approvals will commence when all of the required checks have been undertaken.

In regard to tillage and sheep fencing, I am delighted to announce that I have received informal approval from the Commission for the inclusion of a specific scheme for investment in respect of tillage farmers and the inclusion of sheep fencing as an investment item under the existing TAMS. I am very conscious of the fact that it has been a difficult number of years, in terms of pricing, for tillage farmers. I received a request from tillage farmers to try to put a tillage TAMS in place and for the past six months we have worked to get approval from the Commission for the scheme. It is hoped the scheme will be launched in the coming weeks.

I refer to knowledge transfer. Under the new rural development programme, €100 million is being provided to support farmers in terms of upskilling and training via knowledge transfer or discussion groups. Preparations are being finalised for the launch of knowledge transfer groups across six sectors, namely, beef, dairy, sheep, tillage, equine and poultry.

I am very conscious that the past 12 months have been very challenging for dairy farmers due to decreasing prices. The longer-term demographic and demand perspectives remain positive, but 2016 will also be a challenging year for dairy farmers. The focus is now on helping producers through a difficult time. In this respect, I very much welcome the package of support measures to address the challenges in the dairy and pigmeat sectors agreed in Brussels at last month's Council meeting. This package contains a number of proposals put forward by Ireland, including doubling the intervention ceiling for skim milk powder and butter and the Commissioner's commitment to consider further flexibilities in both the private storage aid scheme for skim milk powder and the state aid regime.

I have called on the Commission to consider the temporary suspension of EU import tariffs on fertilisers and I understand it is looking favourably at this request. It would make a major difference. The price of fertiliser should be coming down in any event as a result of the significant reduction in oil prices.

The Presidency conclusions also referred to the possibility of advance payments under the CAP this year, as was done last year. I also welcomed the proposal for the European Investment Bank and member states to work together with the Commission on the flexibility of an EU export credit tool, something which processors been seeking for quite some time.

I convened a meeting of the dairy forum on 9 March, at which I tasked the stakeholders present with developing on-farm financial planning for dairy farmers. The group met last week, under the chairmanship of my Department, and agreed to organise a series of events this year in that regard. It is about helping farmers through a temporary price problem. A number of people in the Chamber will have a detailed understanding of that.

Pigmeat prices have come under pressure in the past year and a half. Given the strategic importance of the sector to our agri-economy, last year I established a pig industry stakeholder group, chaired by Dr. Sean Brady. The group completed its report in February and presented it to the Food Wise 2025 high-level implementation committee that I chair. My Department is working on a plan for its intimidation the context of the Food Wise 2025 strategy. My priority at the March meeting of the Council of Agriculture Ministers in Brussels was to secure the reopening of the pigmeat private storage aid scheme and I am pleased to note that the Commission has agreed to the reopening of the scheme in 2016.

Ireland has also requested that the Commission intensify efforts to unlock the Russian market, which is a major market for the pigmeat sector in Europe. In the interim, the direct aid package payment has been issued to all pig farmers in Ireland with a minimal level of supply of 200 pigs slaughtered in 2015. In blunt terms, this means a flat rate payment of over €3,000 to each pig farmer.

A specific €30 million envelope for dairy and pigmeat has been made available under the EU promotion scheme. Ireland, through Bord Bia, will make an application for a proportion of that funding in the very near future.

As Deputies are aware, I have allocated €300 million to the beef data and genomics programme, BDGP, scheme. The ambition is to generate an uplift in the quality of the genetic merit of the national herd and a more environmentally efficient herd as well as contributing to the income stream of suckler farmers. In total, there are more than 25,500 farmers in the scheme now and to date almost €38 million has been issued in payments to approximately 20,700 of those applicants. If one looks at the genetic profile change in the dairy herd in the past ten years the resulting impact in terms of things like feed conversion efficiency, yield and overall efficiency and profitability in the dairy sector has been dramatic We can do the same for the suckler herd and that is why we are investing this money strategically. The scheme is supporting incomes for suckler farmers but it is also changing the genetic base of the herd, allowing farmers to make much more informed choices around breeding programmes that can help get more efficient, faster growing animals that reduce the methane output from those herds. It is a win-win across a whole series of areas.

The establishment of a framework for producer organisations in the beef sector was a key outcome of the beef roundtable or beef forum, as it is known. I introduced a statutory instrument in February of this year which gives legal recognition for the first time in Ireland to producer organisations in the beef sector. My Department is currently working with various groups in terms of making that a reality. The relationship between beef farmers and factories in the past has been based on tension, lobbying and a lack of trust. We are going to change that. We are going to set up a much more professional relationship where farmer-owned producer organisations have the legal entitlement to negotiate on price, quality and a range of issues concerned to get a better deal for farmers. That approach has worked in other countries and it will work here too. It is a big priority for the incoming Government to get the system up and running and functioning for farmers in a way they can trust.

In terms of new markets, 2015 was a very successful year for meat exports. Overall exports of beef, sheepmeat, pigmeat and poultry increased by €140 million to €3.5 billion. The opening of the US market to Irish beef in early 2015 has provided an important outlet that holds enormous potential for future development given that we are the first EU member state to gain access. In the first quarter of 2016 approximately 700 tonnes of beef with a value of €6 million are estimated to have been exported, continuing the positive trends from last year. We continue to build on progress in the biggest beef market in the world. We will create an exciting niche market for Irish beef in the US market.

Significant progress has also been made along the path to securing access to the Chinese market for Irish beef with the lifting of the BSE ban by China in February 2015, and an inspection visit by a Chinese delegation to Ireland was hosted in January 2016. We are currently awaiting the report of this inspection team and preparatory work has commenced to help facilitate a follow-up visit, which we hope will take place later this year.

A wide range of other market access opportunities are being actively pursued at present: Israel, South Korea, Vietnam, Mexico and Ukraine. In addition, a Turkish delegation will visit Ireland next week to consider the potential opportunities for live exports to Turkey, which is a massive live export opportunity as long as we can do it properly, ensure the standards are right and that we develop the kind of commercial relationships that can be the basis of a lasting and very important outlet for a growing suckler herd.

On trade issues, I have been very active in highlighting the potentially very damaging impact of a Mercosur deal on the European agriculture sector, and on the beef sector in particular. I am particularly concerned about a draft offer circulated to member states ahead of a planned formal exchange of offers with the Mercosur bloc on 11 May.

My misgivings are shared by a large number of my member state colleagues who have spoken on this issue at recent Council of Ministers meetings, and we have been working together to ensure these concerns are fully understood by the Commissioner for Trade and by the Commissioner for Agriculture, who understands our concerns in detail.

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