Olwyn Enright (Laois-Offaly, Fine Gael)
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Last Friday week, Minch Malt Limited, which is owned by Greencore, announced its decision to close its malting plant in Banagher and its branches in Tullamore and Borrisokane. This will result in the loss of 19 jobs in Banagher and nine full-time staff in its agri-trading branches in Banagher, Tullamore and Borrisokane, a huge blow to the staff, particularly in an area where there are few prospects for alternative employment. We have effectively witnessed this company closing its doors in the midlands in the past nine years — it has closed operations in Roscrea, Birr, Tullamore, Banagher, Borrisokane, Edenderry, Mullingar, Trim, Portlaoise and Rathangan.

This company has not only turned its back on the staff but on 350 specialist malting barley growers in the midlands. These growers supply between 40,000 and 45,000 tonnes of malting barley to Banagher each year, producing 30,000 tonnes of malt. The numbers with contracts to supply Banagher have dropped from 700 to 350 in only eight years. Last week in the Chamber, however, when I raised this issue with the Minister for Agriculture and Food, she said that malt and barley have nothing to do with her. I can only hope that she meant this in jest, even though it is not funny, because it has everything to do with her and her portfolio. The Minister's Department has given grants to malting plants in the past and gave €1 million to the same company's Athy plant in 2002 under the national development plan. I hope the Minister's comments were not indicative of her attitude and the Government's attitude to malting barley growers in the midlands because my constituents and I would find this totally unacceptable.

Growers made their farm plans for this year months ago. The seed will be sown from mid-February onwards — they do not have any other option in such a short time. The growers had a legitimate expectation that their contracts would be renewed this year, as happened every other year. No indication was given to them that this would not happen. In the past, as the chairman of Offaly IFA stated last week, business was based on mutual trust and understanding, out of which a deep sense of loyalty developed. Sadly, this is no longer honoured.

This is a product that is more than a commodity. It is grown at a premium under certain conditions and specifications and that premium has now been taken away from these farmers. It was grown locally to supply a local industry which in turn supplied a national industry. Not only will the growers lose out, so will the employees in the maltings and its branches.

This is not just a matter between farmers and a private company. It has been allowed to operate a monopoly in this area. There are no options open to growers at such short notice. If this company can say to malting barley growers this year that it is not renewing contracts, how do we know it will not do the same thing to beet growers next year? Unfortunately, it was not accepted that I could include the Carlow sugar factory in this debate, and it is not an issue that can be dealt with separately.

Last week I dealt with the cynicism of the company in announcing its decision so soon after the decision on the Carlow sugar plant. Taking both decisions together, they are devastating blows to the arable farming sector in the midlands. We cannot deal with one issue and ignore the other.

Farmers supplying beet to Carlow are facing equally difficult times. They do not have the facilities to store quantities of beet they will need to store if it is to travel as far as Mallow. There has been no information on how this will take place. If the farmers must draw beet earlier in the year, there will be a greater loss of that beet and its sugar content. Beet growers' contracts usually issue in March, leaving them little time to negotiate. If the contractors deliver it will be to Mallow but they do not know what arrangements will be made for transportation costs.

There are also serious concerns about the company's intentions for the sugar processing industry in Ireland. The Minister for Agriculture and Food stated two weeks ago that it is incumbent on the Government to ensure replacement employment and support for the workers of the company. I argue that the Government owes the same duty to the growers who supply both Carlow and Minch Malt Limited. The Minister of State should outline to the House how the Minister intends to fulfil that duty. Can the Minister take action? Has she had discussions with the company in Banagher, Tullamore, Borrisokane or Carlow and what assistance she can give to growers in these circumstances? The Minister will meet beet growers at midday tomorrow, and I ask her to extend the same assistance and courtesy to the malting barley growers.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I am aware that Minch Malt Limited is to close its malting plant at Banagher, County Offaly, and its two intake points at Tullamore, County Offaly, and Borrisokane, County Tipperary, with effect from September 2005. There will be 19 job losses in total. I am concerned about the impact these job losses will have on families in the area, but the decision to close the Banagher malting plant by Greencore was a commercial decision taken by the company. The reason given for the closure is increased competition on export markets. Furthermore, the malting industry within the European Union is stagnating due to a fall in beer consumption.

Minch Malt Limited is part of the Greencore Malting Group, which was formed in 2000 following the integration of the three Greencore-owned malting companies of Pauls Malt in Britain, Minch Malt in Ireland and Belgomalt in Belgium. As a consequence of this integration, Greencore Malt is now the sixth largest malting group in the world. There is one other maltster in Ireland, namely, the Malting Company of Ireland, which is owned by Dairygold and Glanbia, at Togher in Cork.

Minch Malt Limited is Ireland's largest maltster with an annual capacity of 125,000 tonnes. It sources quality malting barley directly from 3,500 Irish farmers, under forward contracts, for its malting plants in Athy, County Kildare, and Banagher, County Offaly. The Banagher plant processes nearly 40,000 tonnes of barley from 300 farms. It is one third the size of the Athy plant, which employs 40. Athy is already at full capacity so it cannot take over the 40,000 tonnes from Banagher.

Farmers who are affected by the closure of Banagher may decide to produce barley for the feed barley market instead. It has been suggested that this will put pressure on grain storage in the midlands area next autumn. The Banagher, Tullamore and Borrisokane facilities will be offered for sale as going concerns and may be taken over by current players in the trade. My Department is carrying out an inventory of grain storage capacity in the Offaly and north Tipperary area. In the event that this inventory shows up a problem in storage capacity for the coming harvest, I will examine the possibility of making funds available to deal with the problem.

Ireland is a surplus producer of malt, with exports in the region of 50,000 tonnes. Minch Malt Limited has been exporting to markets in Russia, south-east Asia and South America. However, Russia has now become almost self-sufficient in malt. Moreover, there is a trade agreement between south-east Asia and Australia which excludes imports from Europe, and South America has always been a difficult market. Exports have been taking place from the output of both the Athy and Banagher plants. Greencore has decided to consolidate operations at the bigger plant, Athy, to solidify the domestic market and it invested €4.5million in this facility last year, increasing the storage capacity and installing new driers. This investment demonstrates the company's commitment to the sector in Ireland.

While I regret that Greencore has had to take this decision, this is a commercial decision by that company dictated by the marketplace and I have no function in this regard.