Charlie McConalogue (Donegal, Fianna Fail) | Oireachtas source

Whether someone is a part-time or full-time farmer, and regardless of size or scale, no one can question the commitment and hard work of sheep farmers across the country. From lambing ewes in the middle of a stormy night to keeping the flock healthy and well over the spring and summer, it is hard work. In some instances, it is a labour of love. Overall, though, the sheep sector is a rewarding one and the demand for Irish product in many key markets shows the importance of what we do at farm level.

A viable sheep sector is an integral element of a balanced regional economy. I saw this at first hand when growing up on my farm back home. Be it upland or lowland, I am committed to ensuring that our sheep sector is protected now and for generations to come.

The maintenance of current hill and mountain landscapes is important from an environmental sustainability perspective as well as from rural community and tourism perspectives. Hill and mountain sheep farming contributes significantly to maintaining high-quality habitats and species-rich biodiversity. Food Vision 2030 is our shared strategy for the sustainable development of the agrifood sector to 2030. Farmers are at the heart of the strategy. The economic viability of our sheep farmers is crucial, not only in terms of their ability to earn a decent livelihood and return on their hard work and endeavours, but also in helping to deliver on environmental and social sustainability. With that in mind, the Food Vision 2030 strategy focuses on the areas that offer the best tools for improving economic viability and resilience - areas that are within the control of primary producers themselves - but also on policies, approaches and technologies that they and others in the agrifood chain can implement to improve their overall economic standing. I have established the Food Vision 2030 beef and sheep group, which plays a critical role in plotting a future for the sector.

Ireland exported sheep meat to nearly 40 markets last year, which is a mark of the world-class product produced on our farms. I recognise that margins in sheep farming have been under pressure as a result of increased input costs as well as lower prices than the record levels achieved in recent years. As we all know, market prices are a commercial matter and not set by the Government, and the Government does not have a role in determining commodity prices in the sheep sector or other sectors. However, I am heartened to see the live and finished trades showing improvements in recent weeks in terms of the prices available and I am monitoring the market closely.

Consumption levels are an issue. Approximately 15% of the lamb produced in Ireland is consumed domestically, with the balance being exported. I have requested Bord Bia to intensify its marketing and promotion of Irish lamb this year through its activities in domestic and export markets. Bord Bia has just finished an additional lamb campaign in the domestic market, which focused in particular on attracting younger consumers to eating lamb. Television advertising campaigns will also run in June and from September to October to coincide with peak supply months. However, we must continue to look to the world, with sheep export markets remaining critical.

Over the past decade, the Department has agreed bilateral sheep meat export certificates for many international markets, most recently with Japan in 2019 and the US in 2022. We are discussing with the US the requirements for approving factories for lamb exports following the announcement of agreed certification arrangements during my trade mission there last year. I will be travelling to China to boost promotional activity for Irish agrifood exports. I hope this visit will also provide an opportunity to engage with the Chinese authorities on their specific requirements for sheep meat imports.

Teagasc estimates that, although output increased by 7% in 2022, the increase in output and price was not sufficient to negate an increase in input costs of approximately 40%. The rapid escalation of production costs in 2022 dramatically reduced the margins per hectare and per ewe. Over the course of the past year, I have moved to support our livestock farmers in dealing with increased costs through the €56 million fodder incentive scheme, which Deputies will know provides up to €1,000 per farm family. I ran this scheme last year and it is in place again this year. I also supported the grant aiding of multispecies swards and red clover to help reduce our reliance on chemical fertilisers and further reduce bills. I recently launched the innovative €8 million national liming programme, which is aimed at all farmers who want to reduce their fertiliser bills.

Teagasc forecasts that the 2023 income outlook on predominantly sheep enterprises will be slightly below 2022 levels at €19,500 versus €19,900. Importantly, this forecast for sheep farm incomes does not take account of the higher payment rates under many schemes that I have introduced under the new Common Agricultural Policy, CAP, strategic plan, for example, the organics scheme and the agri-climate rural environment scheme, ACRES, which are likely to deliver higher total direct payments to many sheep farmers this year. I have provided significant support to the sector under the new CAP, both through a new targeted scheme for sheep farmers - the sheep improvement scheme - and through the broad range of schemes in the CAP strategic plan. More than 19,000 applications have been submitted to the new sheep improvement scheme. It replaces the previous sheep welfare scheme and has a payment rate of €12 per ewe. It is good to see its strong uptake among farmers.

CAP will provide almost €10 billion in supports for farm families over the period to 2027. Sheep farmers are eligible for several other schemes in addition to the sheep improvement scheme, including ACRES and the organics scheme, which are particularly suited to sheep enterprises or mixed beef and sheep enterprises. I have secured places for all 46,000 farmers in ACRES, which I am certain will benefit many farmers. The new organic farming scheme, with a 500% increase in the budget, will provide for a significant increase in payments to farmers, with sheep farmers able to receive €300 per hectare in years one and two and €250 per hectare in years three to five when fully converted. This is in addition to the annual participation payment. Some €2,000 will be paid to organic farm scheme participants in the first year of conversion and €1,400 for every subsequent year of the contract.

Regarding wool production, the Minister of State, Senator Hackett, and I have allocated funding for the establishment of a stakeholder forum to develop and promote the industry. An independent review of the wool market was published in July. It contained multiple findings and recommendations, including potential funding streams and market opportunities for wool, and identified areas for further research and development. One of the main recommendations concerned the establishment of an industry-led wool council, which would develop and promote Irish wool domestically and internationally.

To support this, I have made a funding commitment of €30,000 towards the initial set-up costs of the wool council. The first meeting of parties, including farm bodies, wool merchants and industry representatives that are interested in forming the wool council, took place on 15 December 2022. Wool is a sustainable, durable and versatile product and I want the wool council to plot a path to help drive further added value for wool.

I cannot underestimate the importance of the sheep sector to our agriculture sector. It is also a sector that is particularly close to my heart and is one the Government has made a massive commitment to. It is strategically important to our overall agrifood sector. Money that enters the farm gate of our sheep farms is spent locally. That is critical. As outlined, I have put in place significant funding across a range of supports and measures which will benefit the sheep sector now and into the future. I have asked my officials to closely assess the budget and monitor developments, particularly over the coming period, to see if there is a seasonal upturn in price associated with religious festivals, which often happens.

Since this debate was first requested there has been an upturn in the sheep price from €6.10 per kilogram at the start of March to more than €6.70, which is widely quoted now. I spoke to a farmer at home in Donegal who sold lambs last weekend and achieved a price of €6.85, which would be a €15 increase on a 20 kg carcass. That has happened in the last three or four weeks since we first scheduled this debate. That is positive and I hope we will see more of that. I will work closely with Bord Bia to ensure it is supported in driving on and finding new market outlets to support the sector. The new spring lamb trade has opened and we have started to see them come through in the last week or two. We are seeing prices starting at €7.40 for spring lambs. It is something I will monitor very closely.

I am doing all I can to underpin this sector and provide a platform for it with regard to the Common Agricultural Policy, particularly given the very significant decision recently on ACRES. We need to make sure that is available to every sheep farmer who applied. That will potentially deliver between €5,000 and €7,000 for those in the general programme and there will be an opportunity to avail of a higher payment for those in the co-operation project areas as well. I welcome the opportunity to discuss this important sector and look forward to hearing the contributions of Deputies. I will have to leave shortly before the end of the debate because I have a prearranged commitment in Donegal that I have to go to but I will be paying full attention to all the contributions made by all Deputies and fully reflecting on all the comments they make today, given the importance of this sector and this debate.

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