John Gormley (Dublin South East, Green Party)
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Question 89: To ask the Minister for Agriculture and Food her views regarding comments made by former IFA President, Mr. Tom Clinton, that the beef and suckler industry here is declining at a phenomenal rate; and if she will make a statement on the matter. [38453/05]

Mary Coughlan (Donegal South West, Fianna Fail)
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Beef production is extremely valuable to the Irish economy with a €1.4 billion export value representing almost 25% of total Irish agri-food exports. In 2004 Ireland produced 560,000 tonnes of beef and exported 495,000 tonnes. Almost 90% of these exports went to EU markets. This trend is continuing in 2005 and there is no indication that the beef industry is in decline. The shift to EU markets for the vast bulk of our exports in fact strengthens our position from a strategic point of view.

The year 2005 has been a relatively good one for cattle producers with strong demand continuing across European markets. Average prices are up 9% on the same period last year and up over 3% on the year as a whole to date. While we did see an unusually steep seasonal decrease in prices this summer, the position has recovered and in recent weeks, improved demand and tighter supply has seen a rise in prices again in Ireland and across the EU. Production for 2005 is expected to be down by 3% on 2004.

The reverse situation is expected in 2006 where the outlook is that Irish beef production is estimated to increase by 5%, contrasting with a decreasing production trend throughout continental Europe. The EU beef market is again forecast to remain in deficit by approximately 350,000 tonnes. This will create a positive market environment and should maintain good demand for Irish beef in our key markets with good prices being achieved. An increased presence in this sophisticated high value market is seen as the key to the success of the beef industry in the long term.

The 2003 mid-term review of the Common Agricultural Policy has allowed Irish beef farmers to farm exclusively for the market as premia have been replaced with a single decoupled payment. Farmers can now specialise in enterprises at which they have a comparative advantage with no limiting forms of production save the supply and demand balance of the marketplace. Our ability to grow grass over a long growing season and our mild climate will ensure that we remain a significant producer of cattle in the future.

A main factor on the horizon is the WTO and the effect an agreement might have on our beef sector. While we have a number of concerns going into these negotiations, it is my aim to get the best possible outcome for our beef sector in relation to access arrangements to EU markets from non-EU suppliers, including the sensitive products mechanism, phasing and parallelism in relation to export support and the protection of green box decoupled direct payments. I have also made my views on non-trade issues, such as the need for equivalence in standards, well known to the Commission who are negotiating on the part of the EU.