Séamus Healy (Tipperary South, Workers and Unemployed Action Group)
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3. To ask the Minister for Agriculture, Food and the Marine the progress that has been made regarding the re-establishment of the sugar industry here; and if he will make a statement on the matter. [21777/13]

Simon Coveney (Cork South Central, Fine Gael)
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At the outset, I provide the Deputy with the background to this issue. The EU sugar regime underwent a radical reform in 2005 following major EU decisions to restructure the industry. A temporary restructuring scheme was introduced with the aim of reducing EU sugar production. Greencore, the holder of the entire Irish sugar quota, availed of this voluntary scheme, dismantled its facilities and ceased production in 2006. Ireland secured €353 million as part of the reform package, of which €220 million went to beet growers, €127 million to Greencore and €6 million to machinery contractors. Post-reform, production in the EU is now concentrated in 18 member states and the current regime runs from 1 September 2006 to 30 September 2015. There is no mechanism under the EU regulations currently in force which allows for the re-instatement of a quota for the growing of beet in Ireland for the production of sugar. Of course, sugar beet is still grown in Ireland as a fodder crop. While we do not produce as much as when there was a sugar industry, current production is not far off former levels. It is approximately two thirds of what was previously grown.

In 2011, I met with two separate groups which had conducted feasibility studies on rebuilding a sugar industry in Ireland and putting processing facilities in place once again in anticipation of the ending of the sugar quota regime in 2015. It has been quite clear in the CAP negotiations that, with one or two exceptions, the 18 member states that have sugar industries want to see the sugar quota regime extended until 2020. Along with a number of Ministers from member states that would like to get back into the sugar industry and see the establishment of a freer market for sugar in the EU, I have advocated that we should support the Commission's position, which is to maintain 2015 as the date to end sugar quotas, as agreed. The compromise has been to agree a Council position on 2017 as the end date for the sugar quota regime. The compromise has been welcomed strongly by those who want to re-establish a sugar industry in Ireland. They see it as a timeframe they can work with. We need now to agree with the Commission and European Parliament a final date on which to end the sugar regime as part of the trilogue process to conclude a CAP agreement.

Séamus Healy (Tipperary South, Workers and Unemployed Action Group)
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I thank the Minister for his reply. The closure of the sugar beet industry in 2006 was completely unnecessary and wrong, as found by the European Court of Auditors in 2010. I welcome the Minister's indication on the scrapping of sugar quotas. While we had hoped that would happen in 2015, it would be welcome if we could be absolutely sure it would happen in 2017. The re-establishment of the industry in Ireland is important not just for the industry but from an employment perspective as it would mean the creation of upwards of 400 direct jobs. Further employment would be created in the construction of facilities as well as on farms and among agricultural contractors. In Tipperary, we hope that the site just outside Thurles at Lisheen Mine will be used for a processing facility. The county has been hit badly by unemployment over the years. Does the Minister have any information on the site?

Simon Coveney (Cork South Central, Fine Gael)
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I am aware of the ongoing work by Beet Ireland and the negotiations that have been taking place with the owners of the Lisheen Mine site. It is a very exciting project which I would love to see happen. My role as a Minister is to facilitate an end to sugar quotas as soon as possible or, if there is an extension of quotas beyond 2017, to ensure Ireland is allocated a quota to permit the production of sugar to recommence. It is up to commercial operators and organisations such as Beet Ireland to put business plans together to make this work commercially. We must not forget that we will be competing with parts of Europe which already have the infrastructure in place to produce sugar very competitively. We will have to spend approximately €300 million to put a plant together. That is expensive and will involve loans that must be repaid.

As long as the international price of sugar remains strong - above €500 per tonne - the feasibility studies from Beet Ireland and others suggest that proposals for sugar production in Ireland are credible. If we can make this project happen, it would be fantastic from a farming, industry, employment and stimulus perspective in Tipperary. We must ensure the numbers add up. The last thing we want is to invest heavily only to find that we are not competitive with other parts of Europe. I consider the project to be doable and will do everything I can to ensure we end sugar quotas in the European Union as soon as possible to allow it to get off the ground if the commercial case can be made, which I believe it can.

Séamus Healy (Tipperary South, Workers and Unemployed Action Group)
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I welcome the Minister's support for the project. I understand building a plant takes two and a half years. There was a suggestion sowing sugar beet could commence in the 2016 season. Can the Minister give us an indication on the finalisation of the quota system and its knock-on effects on these two items?

Simon Coveney (Cork South Central, Fine Gael)
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These are fair questions, but it is important we do not run before we can walk. The first thing we must do is ensure Ireland either has a quota or can produce sugar in the absence of EU quotas. At present we can do neither. After I came back from the Council of Ministers having sought agreement on the CAP, I said sugar production was the most difficult issue on which to get agreement for 2017. There is major pressure in respect of production in 2019 and 2020. People want to extend the sugar quota regime because many countries' industries make a lot of money from it. We will try to hold to the Council position as best we can as the Parliament seeks to push the date back to 2020. We will know by the end of June the final outcome of the negotiations. However, I encourage caution. There should be no decisions made on planting sugar beet crops or other investments until we know when Ireland will have the capacity to produce sugar again and when the sugar regime is likely to end.