Cereals sector threatened by cheap imports
Following a meeting with Department of Agriculture and Food officials, IFA Grain Committee chairman Paddy Harrington called on Minister Joe Walsh to act immediately on the crisis facing Irish and EU cereal farmers.
“The time for talking is over. The Minister must take action on the unprecedented income crisis facing cereal farmers and demand that the Commission bans cheap imported grain from flooding into the EU, undermining internal grain prices.
Mr Harrington said the crisis was caused by the EU Commission's decision to allow cheap imports from the Former Soviet Union (FSU) to flood the European market.
The Commission's decision to remove the import tariff on grain from the FSU was totally irresponsible. Their inability to read the situation and to react accordingly meant that the EU had become a net importer of feed grains, rather than an exporter.
He said the IFA warned the Commission last October that their actions would decimate the trade last season and bankrupt grain farmers.
Mr Harrington said the Commission is totally oblivious to the fact that Irish and EU grain farmers are losing money. They have given the advantage away to the US, other major exporting countries and grain importers-traders.
This situation has been exploited by the major importers across Europe and in Ireland in particular. Unnecessary shipments of grain have been landed on the market at the most inappropriate time during the peak of the harvest, displacing native grain from its natural markets and depressing prices.
Mr Harrington said unless the importers and compounders take a broader view, Ireland will no longer have an indigenous cereals industry.
“This will make us totally reliant on imports and the vagaries of the market as happened in 1985 and 1986 when world grain prices went over 200 dollars per tonne.”
The IFA man said it has become uneconomical to produce grain and a 100 per cent set-aside must be looked at as a serious option.
Most cereal growing in this country is now being subsidised from the growing of high value crops such as sugar beet and potatoes or external activities such as contracting.
The exceptional yields achieved by growers over the last few years has masked the problem of grain prices.
It now costs 30 to 40 (including fixed costs) more to produce a tonne of grain than farmers are receiving. This situation needs to be redressed if cereal farmers are to survive, he said.
Mr Harrington said three critical issues need to be tackled immediately by the Commission, Government and feed-grain trade.
Cheap imported grain should be banned from entering the EU. Importers and compounders should give preference to and a premium for assured native Irish grain and grain merchants should pay a price that will cover the cost of production, he said.
