Willie Penrose (Longford-Westmeath, Labour)
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Question 106: To ask the Minister for Agriculture, Fisheries and Food the steps he is taking to offset food price inflation; if he has consulted with various shareholders including farming organisations on the issue; and if he will make a statement on the matter. [19643/08]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Recent data from the Central Statistics Office on the Consumer Price Index shows that Ireland, in common with the rest of the world, has experienced a steep rise in food prices. The cost of food and non-alcoholic beverage prices increased by 8.1% in the year to April 2008. This compares to an increase of 1.6% for the year to April 2007 and mirrors the upward trajectory in food prices as evidenced globally and across Europe throughout 2007 and into 2008.

Changes in food prices are primarily a function of market forces operating at international, EU and national levels. Consistently strong economic growth in developing countries is the main driver of changing world food demand towards high-value agricultural products and processed foods. Slow-growing supply, low stocks, and supply shocks at a time of increasing demand for feed, food and fuel have led to price increases globally. Biofuel production has also contributed to the changing world food equation. In common with the EU, Ireland is not impervious to this evolving change in context. In addition, rising input costs, at both producer and processor levels have fed through to put upward pressure on food prices. Pressure on input prices, in particular energy and raw material including feed costs, has combined with strong competition on world dairy and cereal markets in increasing producer prices.

In response to this situation the EU Council of agriculture Ministers has suspended set-aside, in order to increase cereal production, and has recently agreed a 2% increase in milk quota for 2008. Further measures are being considered in the context of the current discussions on the ''Health Check'' of the CAP. A consultative process has been formed to advise on all aspects of the Health Check and the long-term future of milk quotas. This involves the main industry and farming stakeholders as well as independent experts and will feed into the ongoing debate on all the issues concerned.