Farm Ireland
Independent.ie

Monday 5 December 2016

Subsidies undermining EU farming -- McCarthy

Published 11/01/2011 | 05:00

Argentina's grain storage issues were solved with this cheap and efficient grain silo bag approach
Argentina's grain storage issues were solved with this cheap and efficient grain silo bag approach

A subsidy regime driven by eco-fundamentalism is making EU agriculture second rate compared to unsupported farming systems, according to Kildare-based tillage farmer Jim McCarthy.

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The award-winning farmer said the safety net of subsidies had spawned an indulgent European farmer who felt entitled to the latest tractor with all the "gadgets".

In a wide-ranging speech to the Oxford Farming Conference last week, Mr McCarthy claimed that EU farm payments were holding back the development of scale and productivity gains in commercial agriculture.

He pointed to annual productivity gains of 4-5pc in countries such as New Zealand and Argentina, through the use of cutting-edge technology and rapid advances in scale.

Mr McCarthy contrasted this situation with Europe, where he said the farmer was the most regulated in the world.

He maintained that this was the price that European farmers paid for the €42bn they received annually in farm subsidies.

"We who deem ourselves commercial have traded our silence for our subsidy," he said.

The son of a postman, Mr McCarthy built up a 2,000ac tillage operation in Kildare before he branched out internationally with shareholdings in a 31,000ac arable operation in Argentina and a 7,000-cow dairy in the US. He admitted that he owed his own success to EU farm subsidies, adding that he received an annual single farm payment of €160,000.

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However, Mr McCarthy said that Irish farmers were being asked for a much higher price than they realised in return for their subsidy payment.

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"The number one priority [of the regime] is to protect the environment. Last on the list is the farmer. Farm productivity has been abandoned," he said.

"With limits on fertiliser usage, and the banning of GM crops on the basis of the precautionary principle, forced by eco-fundamentalism and the complete abandonment of science, European agriculture is doomed to become a second-rate agriculture." He said that commercial farmers should demand change to allow them to remain viable in the future.

"There has to be a two-tier agricultural policy for agriculture; one for the 20pc who produce the 80pc, and a social and environmental set of schemes for the 80pc who cannot survive without assistance," he insisted.

Mr McCarthy said Argentinian farming is still more profitable than that in Ireland, despite punitive 35pc taxes on soya exports and an income tax rate of 35pc.

"Despite all this, it is easier to make money farming in Argentina than in Europe," insisted Mr McCarthy. He said that average farm size in Argentina was 500ha compared to 30ha in Europe.

"Cropping 500,000ac is not unusual," he said. "At this level, you really have buying and marketing power."

He gave examples of the different investment philosophy for buildings in Argentina.

"With our European thinking, we would begin building storage at a capital cost of £100/t and also looking for EU grants towards our new building. In Argentina, the storage problem was simply and cheaply solved with the introduction of the grain silo bag, which holds 180t, and is stored along the edge of the farm roadways. Buying new bags each year, and using a contractor to fill and empty the bags, the whole operation costs €3.5/t."

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