Catherine Murphy (Kildare North, Social Democrats)
Link to this: Individually | In context | Oireachtas source

36. To ask the Minister for Agriculture, Food and the Marine his plans for targeted measures that will take account of the impact of sterling currency fluctuations on farm incomes; and if he will make a statement on the matter. [41939/17]

Catherine Murphy (Kildare North, Social Democrats)
Link to this: Individually | In context | Oireachtas source

The Minister answered a very similar question a few minutes ago concerning sterling fluctuations. He said that he wants long-term viability. Long-term viability cannot be assured if there is no short-term security. I want to know what initiatives can be taken to establish different markets and what interventions can be made in the short term.

Michael Creed (Cork North West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

There is no doubt that Brexit poses enormous challenges for the agrifood sector by virtue of its reliance on the UK market.  The most immediate challenge has been the impact caused by the significant drop in the value of sterling against the euro, and I fully understand and appreciate the impact this is having on the agrifood sector.

The sector is of critical importance to our economy given its regional spread and the fact that it underpins the socio-economic development of rural areas in particular.  I am determined to safeguard its interests .

Ever since the UK voted to exit the EU I have been very focused in assessing the impact such an exit would have on the sector.  I did this, inter alia, by consulting with all of the relevant stakeholders.

I held the first meeting of my Department’s Brexit stakeholders consultative group on 7 July 2016, some two weeks after the vote. The work of this group was, and still is, complemented by frequent contact with representative organisations and companies on an ongoing basis, and it operates in parallel with the separate consultation structures under the all-island civic dialogue.

I have also held a series of bilateral meetings with my EU counterparts which are aimed at building alliances to ensure that agrifood and fisheries issues are at the top of the EU negotiation agenda.  Building common ground with other member states is critically important in the context of the negotiations. In all these engagements I am making clear our demand for continued unfettered access to the UK market, without tariffs and with minimal additional customs and administrative procedures, as well as keeping the UK market viable for Irish producers by minimising the risk from UK trade agreements with third countries.

In the last budget my Department led the introduction of a €150 million low-cost loan scheme, new agri-taxation measures were introduced, and increased funding was provided under the rural and seafood development programmes. I am considering what further measures might be required to assist the sector. In the meantime I sought and received sanction from the European Commission to pay a higher percentage advance in respect of the basic payment and rural development programmes - 70% and 85%, respectively - to assist farmers with cashflow issues.

It is critical at this time to work towards reducing our dependence on UK markets for our agri-products, while at the same time retaining our market share in the UK. To give effect to this ambition I have supported Bord Bia’s marketing strategy by initially allocating €3.6 million in the last budget for market work in 2016 and 2017 and more recently by allocating a further €6.7 million to support a market prioritisation exercise and a range of strategic marketing and promotion activities.

I have also had engagement with our main retail partners in the United Kingdom and led a number of trade delegations to seek new market opportunities, which I believe is bearing fruit. It is a complex range of initiatives. The ambition is to ensure that the agrifood sector is not disadvantaged by the UK decision on Brexit.

Catherine Murphy (Kildare North, Social Democrats)
Link to this: Individually | In context | Oireachtas source

Who takes the hit on the sterling differential? The might appears to be very much with the retailers which will be selling on the produce rather than the individual supplier. Obviously proximity in terms of fresh produce is a critical issue, and it is not easy in many cases to find alternative markets. It is quite interesting that Britain is not the only market being discussed. We heard today that Brazil and Argentina have a deal with the European Union on beef which may well pose some additional problems. The one thing about Brexit is that it is going to be uncertain all the way, and if a farmer is going to make a decision, for example, to grow a crop today, he or she needs to have some degree of certainty that the cost of growing it will be covered. That will not be done unless there is certainty that the farmer will get a little bit more than the cost of production. It is short-term thinking. I understand when the Minister talks about the chequebook, but the short-term consequences will be considered when those decisions are made. Are any short-term initiatives being looked at?

Michael Creed (Cork North West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

The Deputy raised a point about the relative position of the primary producer on the supply chain. It is the case, and it is of concern both here and across the European Union, that when there is a squeeze it is the primary producer, or the consumer, who is always most adversely affected, and those in the middle, the distributor and the retailer, seem to be immune. The Commission is seeking to take a number of initiatives on that. In 2015 the then Department of Jobs, Enterprise and Innovation commenced some new regulations in terms of addressing those disadvantages in retailing. It is important that we continue that. Mercosur is not a done deal. We are extremely concerned about what appears to be happening in terms of EU negotiations with Mercosur . We are primarily concerned because 50% of our beef - some 250,000 tonnes - goes into the United Kingdom every year. We are looking at how we can secure that market. It is our nearest and best paying market and we are concerned about what will happen when the UK is conducting its own trade agreements and how we can protect ourselves from that post-Brexit.

We have also given substantial additional funding to An Bord Bia, almost €10 million since the Brexit referendum. That is primarily aimed at securing existing markets and looking for new market opportunities and it is bearing fruit. Our exports to countries outside the European Union increased by nearly 50% in the first six months of 2017.

Catherine Murphy (Kildare North, Social Democrats)
Link to this: Individually | In context | Oireachtas source

The Minister is saying it is not a done deal at this stage. What intervention is he undertaking in respect of that?

Michael Creed (Cork North West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

On the Mercosur trade deal we have been extremely actively engaged with the Commission and other member states. In the past week or ten days we have been very active in building a coalition of 11 member states which share our concerns about a beef proposal in the Mercosur trade deal, particularly because of Brexit but also at a time when the EU market for beef consumption is static, and the Commission has researched the cumulative impact of existing trade deals particularly identifying beef as a sensitive product to further trade development. We have been very active in the Commission and with other member states in building a coalition of member states which do not support the Mercosur trade deal. We are at a very early stage in those negotiations. The Taoiseach raised the matter on Thursday night last, or Friday, with Jean-Claude Juncker in the Commission. We have been extremely active in this area.