Andrew Doyle (Wicklow, Fine Gael) | Oireachtas source

I thank Deputy Ó Caoláin for raising this very important issue. It is particularly relevant to the area from which he comes. Let me reassure him that the Minister for Agriculture, Food and the Marine, Deputy Creed, and I are acutely aware of the challenges the mushroom sector is experiencing in the aftermath of the UK referendum decision to exit the European Union and in light of recent significant currency fluctuations. I am focused on working closely with the industry - I can provide details on that later - to address these difficulties in the months and year ahead.

We are monitoring the situation regarding sterling volatility closely and have set up a dedicated unit to consider the impact of Brexit within the Department. In addition, Bord Bia is working closely with the sector on market intelligence, UK consumer research and quality assurance. They recently held a currency and negotiation workshop specifically targeted at the sector, which I understand was very well received by the mushroom industry. In the coming weeks, the Minister, Deputy Creed, and the CEO of Bord Bia will be meeting executives from all the UK multiple retailers to further highlight the difficulties producers are facing. The Minister has also arranged a meeting with his UK counterpart to discuss the impact the UK decision is already having on the agriculture and food sector in Ireland.

I am also keenly aware of the ongoing impact that the devaluation of sterling is having directly on the profit margins of mushroom producers and growers. The mushroom sector, like many other exporting sectors is particularly at risk because of the high dependency on the UK market. This week we arranged for the payment of just under €1.57 million to one of the mushroom producer organisations under the EU producer organisation scheme.

Bord Bia, in response to the difficulties being experienced by exporters, recently launched its marketing intensification programme. This programme aims to provide targeted marketing supports to companies with high dependency on UK markets. Grant supports will be prioritised to assist companies in strengthening their position in that market and in their efforts at market diversification. The marketing intensification programme is aimed at Irish food and drink producers that operate with a turnover of between €1 million and €30 million and that export at least 20% of their turnover to the UK. The total fund is €500,000, however, eligibility does not confer an automatic entitlement to aid. The selection process is competitive with between 20 and 30 companies expected to be supported. Eligible activities are those undertaken between the date of receipt of the application by Bord Bia and 30 April 2017. The closing date for receipt of applications for the marketing intensification programme is Friday, 28 October 2016.

As part of budget 2017, we have also secured an additional €700,000 in funding for capital investment in the commercial horticulture sector. This will increase the budget for this scheme to €5 million in 2017. In addition, the horticulture sector will have access to the €150 million low interest cashflow support loan fund announced in the Budget Statement last Tuesday, providing access to highly flexible loans for up to six years for amounts up to €150,000 at an interest rate of 2.95%, with an option of an interest-only payments for thee years. Through Bord Bia, we are also investing in a market development programme that will assist companies dealing with currency and trading difficulties.

Let me draw the Deputy's attention to the ongoing support being provided to the industry through national and EU schemes operated by my Department. Under the National Development Plan 2007 to 2013, the Department implemented the scheme of investment aid for development of the commercial horticulture sector. During this period, the Department paid just over €4 million in grants to mushroom growers, which supported €10.1 million in investment. To ensure ongoing support for the sector, the Department extended, under EU sanction, the scheme of investment aid for the development of the commercial horticulture sector to run until the end of December 2019. In 2014 and 2015, a total of €1,635 million grant aid was paid to mushroom growers. The further grant aid paid supported €4.1 million in investment by these growers. Under the 2016 scheme of investment aid for the development of the commercial horticulture sector, the Department issued approvals in the amount of €1.33 million to growers in the mushroom sector, supporting €3.3 million in investment. I will provide a commitment to ensure that payments under this scheme are paid as early as possible, so as to try to alleviate any financial pressure that growers are facing.

The EU producer organisation scheme is a vital support for mushroom growers with 65% of Irish growers in a producer organisation at present. This scheme provides an important mechanism for growers to achieve greater bargaining power in the marketplace by becoming part of a larger supply base, which is very important in the current environment.

Between 2005 and 2016, a total of €41.3 million was paid to the mushroom producer organisations as part of that EU producer organisation, PO, scheme.

See this speech in context