John Ellis (Fianna Fail)

We all welcome the opportunity to discuss this matter. It would be no harm if we had a debate on the entire agriculture industry before the House rises for the summer because the industry is facing chaos which is not all caused by farmers or the EU. In many cases, it is being caused by the people being supplied by the primary producers. The multiples are taking margins which are totally unacceptable from the producers' and the processors' point of view and they are squeezing the daylights out of them.

The other issue is inputs which are 15% to 20% higher in this country than in Europe. That cannot be sustained in the dairy or beef industries. Something must be done to see what action can be taken with the people taking the ridiculous margins at the expense of primary producers.

The dairy industry in this country has not moved with the times. It can say what it likes and while it has done a bit of extra processing and there has been a slight bit of added value, it is frightening to read the figures on the amount of money that has gone to butter and skimmed milk powder production. We are not moving with our competitors across the world. The Irish dairy industry is asleep and it will have to accept that. If it is to be competitive, give producers a reasonable price and compete in the marketplace, it will have to up its game very quickly.

The major co-operatives of ten or 15 years ago are now plcs. The problem is that they will squeeze the primary producers to create margins to keep the Stock Exchange happy. The best paying groups as far as dairy farmers are concerned are the few co-operatives left. They pay better prices to primary producers than the large multiples because they are not squeezing them and are at least trying to give something back to them.

The Minister is doing everything in his power to get aid by fair or foul means in Europe. However, we are funding an industry, the processing and inputs end of which will have to be upgraded. This is a warning sign for agriculture as far as this country is concerned. If something is not done to enable us to become producers for the high-end market in every sector, we will not be able to compete in the long term and sustain our farmers. If we are going to be bulk commodity producers, we will not be able to compete against the New Zealanders or the other countries.

I saw on one of the international television stations the other day that a new unit for 40,000 cows is being set up in China. Imagine the production capability of that unit if it is run properly. We will have to move our dairy and agriculture industries into the higher end market and we will have to deal with the multiples about the margins they are taking at the expense of farmers.