Decision time on beet farms
Martin Healy said the Association, which claims membership in Laois, Offaly, Carlow, Kildare, Kilkenny and Tipperary, wants out of beet, basically because the price on offer is too low, and haulage to Mallow too costly.
Mr Healy said growers who opt out will still get a €9.40 per tonne decoupled payment, and his Association is seeking aid from a €44m regional development fund for replacement of the sugar industry, equivalent to €33 per tonne of beet in Ireland.
He said he has got support from Co Cork for the Association's decision to opt out of beet, and said the initiative will reduce Ireland's restructuring levy bill and shorten the processing season.
But the importance of a guaranteed supply of beet to fill the Irish quota has been emphasised by Greencore Sugar's chief executive, Dr Sean Brady.
He said beet will deliver a reasonable gross margin for 2006, before any decoupled compensation is taken into account. He said the EU base price is €32.90 per tonne of beet, 16.5% sugar would add €1.48, a Greencore sugar price premium of €3.99 has been agreed with IFA, and €1.48 for the 71% of growers not registered for VAT brings the total beet price to €38.37 (growers were paid up to €52.48 for the current crop).
Decoupled and regionalised compensation payments will add €9 or €10 per tonne, according to Dr Brady.
Growers nearer to Mallow are generally thought to be anxious to grow beet in 2006, and potential first time growers may also be interested.
But IFA has ruled out 2006 as the reference year to establish growers' decoupled compensation payment. Minister Mary Coughlan will shortly nominate one year, or a combination of years, as the reference period. She told the IFA AGM it is not possible to clarify all aspects of the sugar reform agreement until various legal texts are available. The process was speeded by last week's European Parliament adoption of the sugar reform report, clearing the way for reform to go ahead.
IFA president Padraig Walshe said beet growing is totally uneconomical in 2006 for growers in eastern counties who pay more than €20 a tonne to transport beet to Mallow. A better offer on price is needed from Greencore, he said.
The new IFA sugar beet committee chairman Peadar Jordan, from Co Carlow, said his main priority was to ensure the €145m buy-out compensation fund is directed to growers, and not to Greencore. He said growers near Mallow or a collection depot, want to continue, but many issues must be resolved before they can decide.
Mairead McGuinness, MEP, has warned that the restructuring levy and sugar price cut together make sugar beet growing unviable.
* Teagasc advise that sugar beet will compete favourably this year with any tillage crops other than potatoes, but the gross margin, excluding SFP, will become negative from 2007 on. Teagasc sources predict 2000 to 2004 SFP reference years, from which the three best contract tonnages could be used.
