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Converting to organic is all very well — as long as consumers are prepared to pay a premium for organic produce

Margaret Donnelly

Incentivising farmers to switch is only part of the battle – the market needs to be developed


Margaret Donnelly

Margaret Donnelly

Margaret Donnelly

'I wouldn't go organic if you paid me', a farmer told the Minister of State for Land Use and Biodiversity Pippa Hackett recently. Speaking at the launch of new and very substantial organic payments, the Minister said it is this kind of mental hurdle that will be the biggest challenge when it comes to organic farming.

However, the new rates the Minister announced last week of €350/ha for dairy farmers; €320/ha for tillage farmers and €300/ha for drystock farmers during conversion, should make it difficult for most farmers not to at least consider a move to organic.

And if that isn't enough, there is a sweetener of €2,000 in the first year of conversion and another €1,400 per annum thereafter.

The new enhanced rates are reflective of a commitment to ensure that our Programme for Government target of 7.5pc of farmland to be under organic production by the end of the CAP cycle of 2027, is achieved, according to the Minister.

That's a lot of ambition for a country that currently has around 2pc of land in agricultural production being farmed organically, but in fairness interest from farmers in organic production has seen over 1,000 farmers attend recent Teagasc farm walks, and the higher rates should be an incentive for many.

But there are concerns, namely around the markets available and consumer demand.

This week the Minister is heading up a Trade Mission to Germany, where seven Irish companies will exhibit at Biofach – the largest organic trade fair in the world. Of the Irish companies exhibiting, two are dairy-related and one is an organic meat processor.

Ireland fundamentally has two years to get markets established if the ramp-up in organics at farm level is to be followed by an increase in demand in the shops.

One of the major drivers of European agricultural policy over the last 20 years has been a market or demand-led approach to policy after years of butter mountains and milk lakes.

In a sense, the idea was that the market would decide what and how much farmers produced rather than subsidies.

However, aligning our organic ambitions with this 'market-orientated' approach will be challenging. The hike in the cost of living this year has seen almost a quarter of UK shoppers say they are trading down, buying what they perceive to be food produced to lower food safety and animal welfare standards. This figures increases to 29pc for people on lower incomes.

The danger for organic farmers is that if the market doesn't keep pace with production, particularly in terms of beef and sheepmeat, it may end up being sold as conventional beef.

And perhaps a greater danger is that the increased supply may reduce the price premium for organic.

Hopefully the tax payer is not left paying for what is, in effect, another environmental scheme, with most of the organic produce not receiving any market premium and reliant on production supports.

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