Andrew Doyle (Wicklow, Fine Gael) | Oireachtas source

I very much welcome this report and commend the committee members on their effort and contribution. This is a very timely debate on a very important sector and we should carefully consider this report. The overall thrust of the report is very much aligned with the tillage actions outlined in Food Wise 2025, the industry blueprint for the development of the whole agrifood sector. The tillage sector is an important and integral component of our agrifood industry, making a significant contribution to overall agricultural output. Crop production as a whole, including horticulture, contributes in the region of €700 million annually to agricultural output at farm gate prices. In particular, the cereals sector is a major contributor to livestock production through the provision of animal feed. Cereal growers also make a significant contribution to the food and drinks sectors in the form of malting barley, milling wheat and oats for the breakfast cereal industry.

I will begin my contribution by referring to the sector for which I have specific responsibility, namely, horticulture. The Irish horticulture industry makes a very significant contribution to the Irish gross agricultural output with a farm gate value of €432 million in 2017. In 2018, I have committed more than €5 million in funding through the commercial horticulture grant aid scheme. This funding will leverage a significant additional commercial investment by the sector. The investment in new technologies that creates more sustainable production systems is central to achieving targets set out under Food Wise 2025 and this nationally-funded scheme underscores the Department's commitment to achieving these targets.

I firmly believe the report's recommendations on diversification into horticulture are timely given the effect of weather events on the tillage sector in recent years. Diversification in agriculture and horticulture is something that can be used by primary producers to spread risk against losses in individual crops as a result of adverse weather or other challenges or both.

I will focus my comments on cereals to the potential of this sector to add value to agrifood output. As I noted earlier, approximately 80% or approximately 1.8 million tonnes of the annual cereals harvest are used for animal feedstuff. As a country, we need to import in the region of two thirds of our total feed materials requirement. This is in marked contrast to many of our EU counterparts, where the import requirement is much lower. Home-produced grain, either on its own or included in a native ration, provides a fully traceable feedstuff that supports the goals for the livestock sector contained in Food Wise 2025.

While the majority of cereal crop production has traditionally been based in the provision of feedstuffs to the livestock sector, end uses are changing. The demand for grain by the food and drinks industries such as malting, milling, breakfast cereal, distilling and as ingredients in the food sector is growing. Current demand for malting barley in Ireland is in the region of 200,000 tonnes, of which 180.000 tonnes is met by contracted malting barley growers. This represents 20% of the total spring barley area sown each year.

While not the answer to all of the challenges facing the tillage sector, the development of niche and specialist markets has potential to improve our competitiveness and sustainability.

The demand for Irish malting barley is growing in line with the sustained growth in demand for Irish whiskey. The marketing opportunity offered by maximising the amount of Irish grain in what are quintessentially Irish brands must be developed to the benefit of all involved and I fully support the initiatives that help to attain that aim. Within the malting barley sector, another specialist niche being promoted by the Department is the use of heritage Irish-bred barley varieties as a unique selling point for individual companies in the ever-expanding craft brewery and distillery industries. I am pleased to report that my Department has funded research on novel high-end lifestyle foods under our research programmes. I very much welcome that an important step at the end of these research projects is the engagement with the food industry with the view to commercialisation.

In view of these areas, I am most conscious of the importance of the maintenance of an efficient and viable tillage sector. I acknowledge that one of the major challenges facing the Irish tillage sector is the low price of grain. This was confirmed in the results of a poll carried out among those in attendance at the recent Teagasc national tillage conference. Unfortunately, cereal prices are highly sensitive to global supply and demand. Low prices have become a feature of world cereal production in recent years.

With regard to the sugar beet industry, my Department continues to monitor market trends. It must be noted, however, that the landscape has changed since Ireland exited sugar production in 2005 and EU sugar quotas were removed in 2017. Prices continue to decrease significantly as they align with world market prices. I am fully committed to the Programme for a Partnership Government statement that “State enterprise bodies will be asked to examine any substantial business plans related to rebuilding the industry with a view to considering appropriate State supports". I reiterate that it is a matter for interested parties to move forward and garner sufficient commercial and financial support to turn their plans into a viable reality.

The recent difficult winter and late spring affected all farming enterprises, and the tillage sector is no exception, with poor ground conditions resulting in delays to planting of spring crops. Teagasc estimates that the area of winter crops sown for the 2017-2018 season has decreased by 14.5% compared with the previous year. It is expected, however, that the recent general improvement in weather conditions will lead to an increase in spring sowing, especially in spring barley and forage maize. In 2017, €3 million was paid to Irish farmers under the EU protein aid scheme, primarily for the production of beans. Earlier this year an extension to the protein aid scheme for 2018 was announced with the same level of funding as 2017.

I come back to some of the recommendations of the report and how these fit with Food Wise 2025 and the supports provided by the Department. On recommendation 24, which specifically mentions forestry for fibre, the mid-term review of the forestry sector addressed that issue. It extended the payment period from ten to 15 years and increased the level of annual premiums to grant and premium category, GPC, 3 from €180 to €510. The establishment grant per hectare per year was increased from €2,165 to €3,650. Therefore, there is an incentive there. As was outlined, the renewable heat incentive, RHI, scheme is under active discussion.

The Department's independent crop variety evaluation programme is a service to the industry provided by the Department and it is based on comprehensive field trials conducted over a number of years in the main tillage regions. An example of the progress made in the crop variety evaluation programme is spring barley yields. Average spring barley yields of control varieties in the recommended list trials have increased by 27% over the past 21 years. The multi-year evaluation programme provides Irish tillage farmers with unbiased information on the varieties most suited for growing under Irish conditions. The trialling system evaluates various crops for yield, quality and agronomic traits, including disease resistance traits which are increasingly important given the continuing reduction in the approvals of plant protection products available for use.

The seed certification scheme is implemented directly by the Department and is invaluable to growers in giving them peace of mind that the seed they sow is of the highest quality and free from weed seeds. This service is provided to industry with only partial recovery of the total costs incurred in running the scheme. I also highlight the additional actions that we have taken to aid the tillage sector. The agriculture cashflow support loan scheme was introduced in January of last year and has been extended through provision of national funds to cover the tillage and horticulture sectors. The banks have advised that all of the €150 million available under this scheme has been committed and is in the process of being drawn down. There has been a very positive reaction by farmers, including tillage farmers, to the scheme, which has proved that significant demand exists for low-cost flexible finance. As announced in the budget last year, funding of €25 million has been secured for the Department to facilitate the development of new Brexit response loan schemes during 2018 for farmers, fishermen and food businesses in primary production.

With regard to the targeted agricultural modernisation scheme, TAMS, and the green, low-carbon, agri-environment scheme, GLAS, as a further support to tillage farmers, the tillage capital investment scheme under TAMS Il covers specific areas of investment, including minimum disturbance tillage equipment, sprayers, fertiliser spreaders and increasing grain storage and drying capacity. There has been a significant level of interest in investments under this measure, with 1,015 applications received so far and 779 approvals. More than €2.63 million has issued in respect of 239 payment claims. The measure remains open to further applications. In addition to TAMS, the GLAS tiered entry system prioritised tillage farmers who chose the minimum tillage or catch crop establishment environmental actions. To assist tillage farmers as well, in particular specialist malting barley growers, the Department decided to grant a special exemption from the basic payment scheme three crop rule to farmers who entered GLAS and committed to establish a catch crop on all of their tillage area.

In response to the exceptionally challenging harvest conditions of September 2016, we introduced a weather related crop loss support measure to assist farmers who experienced significant yield losses in cereal crops. This measure provided support for verified crop losses. Particularly hard-hit growers who experienced verified significantly higher crop losses were eligible for an additional payment per hectare on the same area.

With regard to risk management, all farmers understand that severe weather events come with the territory. I am strongly committed to supporting farmers in managing as much risk as possible. I sincerely believe there is scope to improve the functioning of the EU crisis reserve fund. We will also consider selecting risk management tools such as using mutual funds, insurance schemes and income stability tools to mitigate the effects of severe weather events. Given the increasing frequency of extreme weather events, we must now give strong consideration to implementing these risk management measures in Ireland.

I will leave it at that. I know there are other contributors. The Minister, Deputy Creed, will conclude. Once again, I express my appreciation for the work which the committee put into this report. From my time on the committee I know the amount of effort that goes into such reports. It is quite obvious that all Members have engaged in and contributed positively to it.

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