Simon Coveney (Cork South Central, Fine Gael)

There are a series of topics that we have not had the chance to cover, for example, a soft landing for milk producers, the threat of superlevy fines. If Members have specific questions, I invite them to e-mail me and I will try to give as full an answer as I can.

In response to Senator Quinn, ultimately we must give consumers what they want, because they have the buying power and they spend money. In my view, if given the choice and all else being equal, consumers want to buy Irish produce, not always because it is Irish and that is a growing driver for choice, but because they associate it with quality and a food production system they understand. Some people do not care where food comes from, if it looks good and it is cheap they will buy it. That is a market that needs to be catered for and we need to ensure that consumers are given food at a price that is competitive with prices in other parts of the United Kingdom and Europe. There is a growing sophistication on the part of consumers, and research backs this up, in that they like to know what they are buying andwhere it is comes from. In time they will be asking more questions around issues such as its carbon footprint and what farm it comes from.

Some products are being sold with a code on the packaging which people can enter on a website and get information on the farmer who produced the food. That is taking it a little bit far, but there is a growing awareness and knowledge of the food chain among consumers. This will continue to grow as information becomes available. Take the example of McDonalds, which is the largest buyer ofIrish beef, with the possible exception of one of the major supermarket chains. One in six burgers consumed across the European Union is made from Irish beef. In case people think I am biased, it is the same in Burger King. The fact that it is Irish beef is displayed in every shop. Consumers are reasonably happy with these products.

The ideal scenario is that we grow the percentage of Irish produced food in Irish food outlets and in retail stores because it is the best and most competitively priced food available. That needs to be the primary driver, rather than trying to impose quotas on multiples. Imposing quotas of having to buy two thirds Irish is no way to build a food industry. One of the reasons Ireland should be able to do this is that 85% of everything we produce needs to beat the competition based on other people in other countries saying we must buy our own homegrown produce. That is the case whether it is Irish beef in Germany, Irish lamb in Italy or Irish seafood in France. They are the largest markets for our produce with the exception of the UK. People eat Irish mussels in Paris because they are the best mussels. Organic Irish produced farmed salmon is the most sought after salmon in the European Union. I will talk about fish later.

We need to concentrate on encouraging but not forcing the home market to buy Irish food. However, that misses the point that the home market is only 15% of the food market, the other 85% is about being competitive enough to compete abroad and win market share and be better than other produce on the shelf, in the factory or in the restaurant so that consumers actually chose it. Our aim is to be the best at what we do. Let us consider what New Zealand has achieved. It has made some mistakes, but in terms of its growing market share, it has succeeded because it produces quality food at competitive prices and it does things well. That is the case with its entire food chain. It is not just farmers, it is also food companies, co-operatives, etc. That is what Ireland needs to be about.

We do not have enough pigs to meet the demand in the Chinese market. If we had pigs on every acre at a stock rate that would be unacceptable to the European Commission, we would still not be able to feed Beijing, never mind all of China. In the pig and poultry markets we need to decide what segments of the market we are targeting to give us added value and premium prices so that pig producers get more from what they produce. We are not in the volume business and we cannot compete with other parts of the world in terms of mass production. We have family farms and we can improve economies of scale by getting farmers to work in partnership, but ultimately food produced in Ireland is about a premium product that it can command more on the supermarket shelf because it is special. This involves traceability and husbandry and other matters we can promise. The Irish brand is about a promise. That is why Chinese consumers in Beijing are choosing New Zealand or Irish infant formula. They do not trust the infant formula produced in the dairy industry in China because of scandals of the past. We need to build on the hard-earned brand and the promise that gives Ireland a stable and safe reputation for producing food. The evidence is that consumers will pay a little more for that if we target market cleverly.

In the home market, we must be competitive with imports. Our relationship with the UK is a good example. Not all Members were present in the Chamber when I said earlier that last year we exported €3.6 billion of food and imported €2.7 billion. That balance is pretty good for 4 million people but we are still importing a lot of food. If we are concerned about food excellence and giving consumers choice, we must import products we cannot produce competitively or products we are not good at producing. We must concentrate on what Ireland is good at and for which Ireland can put a premium brand in place in terms of selling abroad and finding new market share.

There is an idea that we do not have research facilities for food but that is incorrect. The week before last I launched a significant research project on cheese that is co-sponsored by Teagasc and the Irish Dairy Board. It is located at Moorepark, outside Fermoy. In Clonakilty, seafood research and seafood added value is another example. We have given grant aid to the fish processing sector. We are doing a great deal to add value, skill and intellectual capital to the food sector by how we spend money. I am encouraging more private sector involvement in research programmes and development programmes for food. Partly this is because we cannot afford to do it all ourselves due to shrinking budgets, but also because it is in the interests of the private sector to do so. I will launch an exciting dairy project with Glanbia in September. It involves up-skilling farmers on running a business from a financial and accounting point of view as well as farming. That is the kind of partnership we need to create with the private sector, which should be co-funded.

I want the brewing industry to form discussion groups in place for malting barley farmers, just as we have done for dairy farmers. This will ensure we are producing malting barley efficiently. The benefit to the brewing sector, including Diageo and Heineken, is that it will have a stable supply. We seek the same situation in respect of beef. If we are to set up beef discussion groups, which I want to do to up-skill the farmers, I want co-financing from the big beef processors. It is in their interest to do so and I will demand it because the State cannot afford it anymore. This concerns creating partnerships on research, developing an industry, fulfilling targets under Food Harvest 2020 and everyone contributing and benefiting. This relates to finance and intellectual capital.