Michael Harty (Clare, Independent) | Oireachtas source

I am happy to speak on the motion, tabled by the Rural Independent Group, on the beef price crisis which has been ongoing for the past two months. The practical outcome of the beef price crisis agreement is that beef farmers, who continue to feel isolated, helpless and desperate, go back to the status quo. They have been given a promise on price without any guarantee or commitment that a realistic base price will be paid for their premium product. The base price can still be manipulated with little or no transparency. This is not a good outcome for the farmer. Even if beef farmers hit all the quality criteria, they will not get a price which comes near to the cost of production.

Farmers are the ticking heart of rural Ireland. The Minister of State, Deputy Doyle, who is present, knows as well as I do that they are the core of rural Ireland. They are not being protected from predatory meat processors. Farmers are under serious financial and mental strain and feel badly let down by the Minister, Deputy Creed, the Government, the meat industry and Bord Bia. Meat processors continue to make a handsome profit while paying the minimum possible price. A profit can be made by all parties in the meat industry - producers, processors and retailers - if there is respect between the three components. Unfortunately, that respect does not exist and was not engendered by the agreement hammered out last week.

It is completely unacceptable that processors use their dominant position to maximize their profits at the expense of beef farmers, a situation that has not changed one iota as a result of the talks. The essential recalibration of profit and loss in the beef industry has not taken place and the farmer still loses while everyone else wins. There is enough of a margin in the industry to allow all involved to make a reasonable income.

Meat processors recognise the value of offal, the fifth quarter, yet the farmer gets nothing for that component of the animal. It is an additional bonus for meat processors and generates additional profit for them at the expense of the farmer who is powerless to object. Surely, farm organisations and the Department of Agriculture, Food and the Marine must act on this type of sharp practice.

Bord Bia continues to promote Irish beef as an excellent product without referring to the fact that farmers are being exploited by being forced to sell beef cattle at a loss in order that all others can make a profit. Bord Bia's welcome for the most recent agreement in order that normal business can resume does it little credit. It will continue to promote Irish beef as a premium product while the beef farmer is being exploited. That is not fair trade and it is not acceptable internationally.

Farmers were threatened with court action by the Competition and Consumer Protection Commission and pressurised by Meat Industry Ireland which played one farmer off against another and laid off factory workers rather than enter into face-to-face negotiations and pay a sustainable price. Such behaviour is completely unacceptable.

The most important result of the dispute is the establishment of producer organisations which will be able to represent farmer in price negotiations. It is a very positive development. These organisations will convert farmers from price takers to price makers. However, meat processors will try every trick in the book to undermine the establishment of producer organisations, which they regard as a threat to their profitability. The Beef Plan Movement was approved as the first producer organisation and will be able to legally and collectively negotiate price on behalf of its members. However, there needs to be several more such organisations for them to be fully effective.

Unfortunately, power has been consolidated in the hands of a small number of meat processors and that grip on power will not be easily loosened. ABP Food Group, Dawn Meats and Kepak account for 65% of the total beef processing market. SuperValu, Dunnes Stores and Tesco have 67% of retail sales between them, while Aldi and Lidl have 21%.

On the broader question of rural sustainability, if beef farming continues to be unviable, the economic sustainability of communities in counties Clare, Cork, Kerry and Tipperary will be put at risk. All such rural communities will be put at risk. Even in light of the agreement, the future for the traditional beef farmer looks bleak. Unless the current economic model is re-calibrated, soon only industrial-style farms and feedlots will survive, with the loss of farm families from rural communities and the resultant knock-on effect of continued rural depopulation. The cards are stacked against the family farm as a viable entity by greed and profit. However, it does not have to be this way. A fully independent investigation of the meat processing industry needs to be carried out and include an examination of pricing, trading and employment practices and compliance with taxation in order to ensure that it is not only farmers who are being exploited. Fair trade is the only viable future for beef farming as anything less will spell the continued decline of rural Ireland. The principles of the report of the Commission for the Economic Development of Rural Areas need to be revisited in order to re-establish a vision for rural sustainability. Rural sustainability is built on the farming community. I ask that the Government does not let it wither on its watch.

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