Farm Ireland

Friday 19 April 2019

Opinion: 'We should not buy into the notion that Ireland will remain for ever more dairy-dependent'


Darragh McCullough eats, sleeps and lives farming. Photo: David Conachy
Darragh McCullough eats, sleeps and lives farming. Photo: David Conachy
Over €91m of mushrooms were exported in 2017. GETTY
Darragh McCullough

Darragh McCullough

In some of my more idle moments, I wonder what my 150ac farm would be able to generate if I looked to pump as much value out of every acre as your typical pig farmer or mushroom grower.

Of course, you would be talking millions to put up all the facilities required, but there is that nagging thought that I'm really not making the most of the land as a pure asset.

The same thought crossed my mind when I saw Bord Bia's latest export figures. No doubt there will be plenty of back-slapping following the confirmation that food exports have grown for the eighth consecutive year to hit another "record" high of €12.6bn in 2017.

Agriculture ministers get a good six months of rolling out these figures at every gig they turn up at, with the subtext being that the lads behind all the Food Wise and Food Harvest reports were on the ball and semi-visionaries.

But now that we like to think of ourselves as real players on the international scene, it's useful to compare ourselves to the best operators globally.

The Dutch farm an area equivalent in size to Munster, yet their food exports are closer to €60bn - five times ours.

And as the mushroom sector proves, increasing output per acre isn't totally dependent on having access to the best quality land.

However, you won't hear too many dissenting opinions on the latest export figures because they are all going in the right direction, largely on the back of a golden patch for the Irish dairy industry.

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It's not so long ago that it struggled to hold its own compared with the totals for the beef sector. But the last 10 years have changed all that.

The €4bn of dairy exports dwarfs the beef sector, even though the latter has had a pretty decent year. Beef exports increased by 5pc, but in absolute terms, this €125m increase looks puny beside the €665m increase recorded by their dairy counterparts.

In all likelihood, with the rate of dairy expansion continuing unabated, it's more than likely that it will put more miles between it and the beef sector over the coming years.

That's great when dairy markets are solid, as they are now. But as Bord Bia were at pains to point out last week, the white stuff is just another commodity, and commodities have their booms and busts, and there is a downturn out there somewhere in the future just waiting for its turn.

With close to a third of all food exports now reliant on the black and white cow, it leaves the entire agri sector dangerously exposed when those markets do turn sour.

I also have the sense that 2017's figures might just be the calm before the Brexit storm hits in earnest. Don't forget that a vast quantity of our cheddar exports - a massive 78,000t - depend on the UK market. If that stat doesn't make you nervous, I don't know what will.

But we should not buy into the notion that Ireland will remain for ever more dairy-dependent.

It's not so long ago - during the Second World War - that one of the country's biggest food exports was rabbits. Believe it or not, there were hundreds of businesses all over the country like Castlemahon Co-op in Limerick that were skinning up to 2,000 rabbits a night to help feed Britain during the height of the Emergency in the 1940s.

Go further back to an earlier emergency on this side of the water, in 1847 at the height of the Famine, when Ireland's main export was grain.

Over 4,000 Irish boat-loads of grain headed for Liverpool alone during that year - a terrible thought but a fascinating one too.

Today we have a handful of mushroom producers exporting more than the entire grain sector, with over €91m of mushrooms exported in 2017, compared to just €69m of grain.

This is despite the fact that the grain sector depends on about 750,000ac of top-quality land to support it.

OK, I know that at least 75pc of the grain is used domestically. But even if you took 20pc of the cereal area, would the entire mushroom industry account for 1pc of the 150,000ac devoted to cereal exports?

This is what brings me back to my day-dreams about how we as farmers are utilising our assets. Put a handy figure of €8,000/ac on the land involved and you come out with €1.2bn in land assets tied up in grain exports, compared to say €12m in mushrooms.

Of course I'm not advocating that everyone starts growing mushrooms or building pig farms. But we don't want to turn the whole country into a giant milking parlour either.

Maybe more farmers should be looking at ways to maximise the use of their assets by hitching their wagons to fast-growing sectors.

One example is the whiskey sector, which recorded growth almost on par with the dairy sector this year.

Why can't grain farmers capture more the added value in this product by malting or distilling their grains?

There also has to be scope for more nurseries selling close to €100,000/ac, and dare I say it, but could there be an(other) Irish rabbit industry in the future?

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