Victor Boyhan (Independent) | Oireachtas source

I welcome the Minister. I note that he is proudly wearing an orange and green badge on his lapel. I noticed it as I stepped into the Chamber and I commented on it to him. That gives me an opening to say that the Bord Bia strategy for 2016 to 2018 is making a world of difference. It is an important document. It is referenced in the programme for Government, and that is to be welcomed. Clearly, the strategy is going to have some setbacks. All of this needs to be looked at in the context of the horticultural sector. Mushroom and cut flower production are among a range of horticultural activities in the food and ornamental sectors that need to be examined. I think it would be helpful to take some time out at some point to look at the strategy document in conjunction with Bord Bia to see how we can progress as much of the strategy as possible. I believe it is a good and concise strategy and I salute Bord Bia. The organisation is an altogether focused one that does a very good job. That much needs to be acknowledged.

We know that the European Union is the UK's largest trading partner, accounting for 62% of UK food and drink exports and 70% of UK imports. Therefore, it is not surprising that the exit vote has led to significant market volatility and uncertainty. The UK agricultural industry currently relies heavily on EU subsidies. A study undertaken by the UK Department for Environment, Food and Rural Affairs showed that more than 30% of British farms could be in negative income without the Common Agricultural Policy. There may also be a possibility of a reduced CAP overall without the contribution from the British. This will have an impact on Irish and EU farms. It is critical to consider how the changes in CAP will affect farmers in Ireland. I am keen to hear what the Minister has to say on that point.

The UK is Ireland's largest market for food and drink, accounting for 41% of Irish food and drink exports. The value was €4.4 billion in 2015. Strong growth in exports to non-EU markets has been evident in recent years. However, the UK remains the core market for Irish food and drink exports. Between 2010 and 2015, Irish exports to the UK increased by €1 billion. This was largely driven by an increase in meat exports. Meat exports make the highest proportion of Irish food and drink exports to the UK, followed by prepared foods and dairy. The UK accounts for 54% of total Irish meat and livestock exports, reflecting the fact that this is the highest priced beef market in the world.

Exports to the UK represent 30% of dairy, 70% of prepared foods and 30% of beverage exports. In the edible horticultural and cereals sectors, the UK accounts for 90% of Irish exports. In the dairy sector, over 65% of our cheddar cheese is exported to the UK while large shipments of butter and infant formula, etc. are exported there too.

As my colleague noted earlier, mushroom exports account for the vast majority of the edible horticulture sector category and are, therefore, almost totally dependent on the UK market. We know about shelf life and so forth. Will the Minister outline the Government policy or strategy or the nature of supports in place in respect of hedging strategies for currency fluctuations? The Minister will beware of the major stake the people have in Allied Irish Banks. How is the Minister or the Government interacting with that bank or any other financial institution in respect of currency fluctuations and hedging? Clearly, many of these problems are related to the fluctuation in sterling. What is the role of Enterprise Ireland? Will the Minister share with us precisely what measures Enterprise Ireland is undertaking in respect of these matters?

Liquidity and cashflow are critical. To be fair, there has been an increase in lending to the agricultural sector, specifically in the past year. That is to be welcomed. Clearly, this is a major issue as well.

The issue of border controls is relevant. The withdrawal of the UK from the EU would effectively mean that Ireland's Border with Northern Ireland would be, by definition, an external EU border. This will lead to increased regulatory requirements and costs as well as a physical border between both parts of the island of Ireland. This is relevant for the food and drink sectors because it will mean €525 million of fresh food and drinks will be exported.

There are serious difficulties in this area. In this crisis there are major challenges for the island of Ireland. We have heard the remarks of Nicola Sturgeon in respect of Scotland. There is a real possibility of another referendum there, and I can understand why. There may be political implications for Northern Ireland. A northern Unionist said to me recently that while they may be loyal to the British Crown, they are perhaps more loyal to the half-crown. That says something. It is about money, the economy and sustaining the family and the farm as well as farm and producer incomes.

There are major challenges for North-South cross-Border co-operation in this regard and I am keen to hear more from the Minister. Will he tell us more about his plans to foster co-operation? I welcome in particular the fact that Nicola Sturgeon will come here from Scotland to share some of the same concerns. Within all of this there are possible opportunities that we should not overlook as well.