Efficiency ploughing ahead hand-in-hand with informality

It was a week in which the business news was dominated by the travails of dodgy German car salesmen and by the Flight of the Web Summit Earls to a less costly Lisbon.

It was a relief for this Dublin-based journalist to make an inaugural visit to the National Ploughing Championships near Stradbally, a town perhaps best known for its association with steam engines.

Happily, the ground was firm enough and the caking of mud on precious urban boots could be quickly tossed off.

There is, indeed something of a Victorian sense of optimism and organisation about this event. Prince Albert himself, a great business innovator, could only be impressed by the McHugh women, mother and daughter, the driving forces behind one of Europe’s largest outdoor agricultural shows.

On the continent, similar trade events take place in cavernous halls in places such as Hanover in the heart of Germany, but in Laois last week, efficiency marched hand-in-hand with informality.

One could only take pride in the great parade of temporary structures spread out in all directions as far as the eye could see.

The grub was of the no-nonsense variety, pieces of fried lamb steak and burger on bread rolls and ciabatta, priced at realistic rather than bargain basement levels.

The world and his wife beats a track to the ploughing in order to promote their wares. Sinn Féin jostled for space with KBC Bank.

Efficiency ploughing ahead hand-in-hand with informality

Éamon Ó Cuív kept a small crowd entertained with anecdotes in the Fianna Fáil tent, which was predictably enough decorated with photos of a gentleman with spectacles in khaki uniform.

I first stopped off at a stand occupied by Murray Timber, where the staff were on the look-out for suppliers, rather than customers.

It seems that our mild climate ensures that many tree varieties grow here twice as fast as in the traditional timber-growing heartlands of Sweden and Russia, which is not to say that Irish growers find themselves on the pig’s back.

The big development this year has been the pull back in China, which means that the Scandinavians and Russians are targeting the UK market with cut-price product, hitting Irish firms.

Nearby, however, sales of a new wood-cutting device, Timber Croc, were holding up well.

Commodity price weakness has brought a new caution to many of the attendees and one source suggested to me that sales of capital goods have taken a big hit, though the sales executive at Jungheinrich, supplier of pallet trucks, was quietly upbeat.

This German engineering company took off in the 1950s and now employs almost 100 people in Ireland in sales and distribution. Its customers are typically in the retail and agribusiness sectors.

Its devices have ensured that many employees have avoided the worst of the back strain associated with the lifting of heavy boxes.

Glanbia is one of Ireland’s agribusiness stars, in turnover terms, at €3.5bn in 2014, ranking second behind Kerry Group.

The view in the Glanbia tent is that a turnaround in the milk price is unlikely before the middle of next year. It is pointed out that it is still well above the low prices of 2009. Over- borrowed farmers will be keen that there is no further softening.

There were mutterings last week that the banks may have got it wrong again, lending too much to expansion-minded farmers in the run-in to the abolition of milk quotas, an abolition which a distinct minority of producers have come to regret.

The word is that the banks are now lending big-time to financially stressed dairy men to assist them in meeting the tax bill run up in the good years.

Plummeting commodity prices have impacted right across the agricultural industry, which accounts for an estimated 250,000 jobs, direct and indirect.

The impact on tax receipts from the self-employed and corporate sectors from 2016 on could be considerable.

Mullingar-based David Clarke has built a business around trade in livestock, having recognised the huge difficulties of making a living in an industry where the primary producer is a price taker.

Increasingly, the firm’s trade is export- oriented, with Britain the main port of call. Clarke has one client, a farmer in Shropshire, with 3,000 cattle. The man in question was giving a very polished video presentation about his business.

In Ireland, there are already farms with more than 2,000 cattle on them. Many smaller producers will disappear unless they can achieve income diversification.

The English, it seems, are increasingly interested in our stock, while Clarke secured its first sale of stock to a French farmer recently.

It seems that the Teagasc facility at Moorepark should take a bow for its success in helping to develop suitable cattle breeds in this country.

However, it remains to be seen just how far Irish producers can develop in an environment where the dice is loaded in favour of buyers from the likes of Tesco to Larry Goodman, a man who, 25 years after the Goodman Group Examinership, made possible by emergency legislation, is as powerful a player as ever.

It remains something of a mystery as to why the competition authorities in Ireland and Brussels appear to have desisted from a really in-depth investigation of the food sector’s in-built imbalances when it comes to pricing and commercial power.

One of the big stories of the year was the commissioning of the Glanbia plant at Belview, near Waterford, at a cost of close to €200m.

The plant is the largest infrastructure investment in Ireland by a private company.

Apparently, the intensity of demands from milk powder customers has been such that it is taking rather longer than expected to reach its full productive capacity, something that will be of more than academic interest to the circa 1,600 indirect jobs that will depend on the plant (which employes 75 people directly).

At the other end of the scale, individual farmers also have businesses to run.

At the Bord Bia tent, two experts were giving a very interesting talk on the potential pitfalls beef producers face as they set out to achieve the highest possible price for their cattle.

It seems that poor planning means some end up with cuts of meat not suited to the demands of the supermarkets and destined instead for the roasting/catering business where the price per pound is much lower.

And the ‘Bia’ demonstrators had a warning for those who allow their cattle to get too fat. Excessive fat impacts on taste and on the realisable price, which is ironic as it is these cattle which have cost the most to rear.

Another bugbear, so to speak, has been the over-production in Ireland of young bulls which, apparently, are not greatly prized in the restaurants, whatever about the barns, of the world.

Politics, milk prices, timber supply, and bank lending policy were all up for discussion at the National Ploughing Championships, says Kyran Fitzgerald

One could only take pride in the great parade of temporary structures in all directions


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