Farm Ireland

Thursday 22 February 2018

Sea change in thinking is needed if ambitious plans for growth are to be met

John Shirley

IS THIS for real? That was my initial reaction to the recent publication of 'Food Harvest 2020', a vision for Irish Agriculture and Fisheries in 2020. Here we are with collapsing cattle and sheep herds, inability to reach our national milk quota in the last two years, record farm borrowing, lame duck banks, run-down soil fertility and being screwed by retail multiples. Yet the brains of the country, or, let me rephrase this, a committee of 30 agri leaders who produced the Food Harvest 2020 report, suggest that Ireland's agri and fish farmers can turn this runaway truck around and deliver a 33pc jump in food exports by 2020. And this is to be achieved while saddled by an ever increasing green agenda. Dream on.

But let's not be negative. Let's buy into the very worthwhile ambition of enabling Irish farming to realise its wealth creating potential. This would be good for farmers. Equally the overall economy would benefit. Also let us recognise the inherent merit in planning; failing to plan is planning to fail, and all that.

And fair dues to the Minister for Agriculture and even the Taoiseach. They have taken ownership of this ambitious plan with Minister Smith personally chairing the industry wide committee that will drive it forward.

But what's new or what will change that can bring about this desired growth and expansion? Certainly we cannot continue to drift along as before. Continuing to travel the same path and expecting a different outcome has been defined as insanity.

The main change is that the Irish economy is in dire straits and in such times we tend to return to old reliables. Agriculture may not be glamorous but it is not going to let you down like an Anglo Irish Bank or even Fás.

If this plan is to succeed, it is going to demand a sea change in the mindset and culture of the Department of Agriculture. It's back to the philosophy of "one more cow, one more sow, one more acre under the plough", rather than the priority of inspection and penalty. Farm leaders regard current Department management as the most conservative and cautious to date. Can they reinvent themselves? Can they change from inspection mode to expansion mode?

Almost every paragraph in the Food Harvest 2020 document outlines an enhanced role for Teagasc. Yet the reality is that Teagasc suffered a €10m hit in the last budget and McCarthy's Bord Snip envisages further cuts. Will this policy change in the light of the new report?

The big change in the pipeline for Irish farmers is the abolition of EU milk quota but this is not happening until 2015. However a 50pc jump in milk output is the engine that is to haul Food Harvest 2020 into the promised territory.

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Such expansion over a short period is technically possible but will farmers respond to this plan? The trend is for dairy farms to get fewer and bigger from almost 50,000 at the start of milk quota to less than 20,000 today.

Past experience shows the major expansion in the suckler and sheep herds was brought about by premium incentives. Farmers respond to the profit incentive. I don't really buy into the theory that the burgeoning world population is going to cause world food shortages and big price hikes in commodities by 2020.

At 30 cent a litre, milk is the only mainstream Irish farm enterprise that is delivering a worthwhile profit. There is a pent up expansion potential on existing dairy farms and there are a few large-scale new entrants being mooted. It is expected that non-profit making tillage and drystock land will be switched into milk post quota. But have these category farmers the appetite for the hard graft and seven-day commitment that goes with dairying or would they rather be at the Galway Races?

Processing this extra milk will demand an investment of an estimated €400m. No mention of where this is to come from but a small slice of the €22bn given to Anglo Irish would help.

The 2020 report envisages a 20pc expansion in sheep. Given a favourable price environment that target is possible. Growth on the beef front is to come primarily from the added value outside the farmgate. No growth in suckler cows is envisaged but the recent exodus from suckling may be stemmed by the suggestion that the premium may be recoupled. The one growth area in suckling, the production of quality calves for live shipping, is not mentioned as a business worth promoting.

If dairy cow numbers expand as envisaged there will be extra calves, potentially for beef. Hopefully these will not be Jerseys and extreme Holsteins. With increasing use of sexed semen there is extra potential for beef crosses. ICBF predicts that genetic improvement can add €200m to beef income. If the Department is serious about supporting genetic improvement the sire should be included on the animal passport.

Much of the report is given over to frothy jargon about biodiversity and environment and our green image. Certainly let us have high standards and exploit this in our branding. But at farm level environmental issues should be science based. A case in point is the official response to the GM debate.

Overall, while the plan is wildly ambitious, the return of emphasis on agriculture (and fishing) is to be welcomed. The fact that the minister has set targets and committed his department to them is also interesting and positive.

However, one overarching issue that must be addressed with or without a Food Harvest 2020 is the farmers' declining share of end price of everything we produce.

Irish Independent