Farmers seek ombudsman amid demise of commercial veg sector
'We are losing growers from the industry because they cannot continue to endure the measures.'
It is estimated there are fewer than 100 commercial vegetable growers in Ireland, compared to about 350 in 2010, the Oireachtas heard this week.
The decrease, according to Irish Farmers’ Association president Tim Cullinan, can be almost exclusively attributed to the reducing price being paid by the big retail buyers to their suppliers, forcing more and more of them out of business".
“The result is what we see on the shelves today,” Mr Cullinan said.
Preliminary figures from the CSO show that in 2021, Ireland imported more than €1bn worth of vegetables and fruit.
“Imported broccoli from Spain; imported tomatoes from Holland; strawberries from Egypt; raspberries from Morocco,” Mr Cullinan explained.
“All these crops can be grown and produced almost 10 months of the year in Ireland — but only if the retailers pay the cost of local sustainable production," he said.
The IFA has reiterated its call for a ban on below-cost selling, seeking for this to be “enshrined into Irish law and regulated by the new food regulator office”.
“The discounting and degrading of food must be stopped,” Mr Cullinan said.
“It is a sad state of affairs when farmers who are producing beef and dairy products, where over 90% of what we produce in Ireland is exported, are doing better in world markets than farmers supplying fresh fruit, vegetables, pork and poultry to be consumed here in Ireland.”
He said the falling price of food, and of fresh produce from the horticulture sector, in particular, has "resulted in squeezed margins for primary food producers and it now poses a significant threat to the viability of primary food production in Ireland in these sectors".
Horticulture is the fourth largest sector in Irish agriculture, behind beef, dairy and pigs, with a farm gate value of €477m.
Mr Cullinan said the challenges facing this sector, along with pigs and poultry, in particular, are “multifactorial”, but that they centre around costs of production, and domination of a small number of retail buyers, “resulting in ever-tightening margins”.
Produce from the horticulture, poultry and pig sectors is dependent on the Irish retail sector for a route to market, the IFA said.
Ireland’s retail environment is dominated by five players; Dunnes Stores, SuperValu, Tesco, and two discounters — Aldi and Lidl.
These comments come following farmers’ protests led by the IFA outside retailers over the last number of months, the most recent being those outside Dunnes Stores in Cork and Monaghan.
Mr Cullinan told the committee the retailers they engaged with acknowledged the input cost increases being experienced by producers.
“They pointed out that they have a practice with a range of produce whereby they have contracts from six months to one year in duration,” he explained.
“They gave us a commitment, which we need to see followed through on, that they would go back to their processors and suppliers because of the extraordinary circumstances and look at the contracts again.
“We have engagement with the processors. If we did not, we would have to stand outside their premises as well.”
Niamh Brennan, IFA horticulture policy executive, said the sector was in a situation where “we are losing growers from the industry because they cannot continue to endure the measures”.
“Our critical mass has been eroded. It is feared that if we go below that, we will not have a core base to be able to re-establish the horticulture industry," Ms Brennan said.
She said there was “no point talking about any policy or specific strategy” that is in place to try and expand or redevelop the sector “if we do not have that core mass”.
Meanwhile, the issue of availability and cost of peat for the sector is something the IFA “will take further” in the next number of weeks, Ms Brennan said.
Mr Cullinan said any intervention by Government, including the €7m Pig Exceptional Payment Scheme, “is always welcome”, however, farmers are going to "need more intervention”.
“More funding is needed; we need everybody sitting down and negotiating how that is going to happen, put structures around it,” he said.
It is critical that we have a structure and a way to protect this sector until a time that the market starts to improve.
“The market will improve. The major concern is about where inputs are going.
“There has to be more intervention by the minister and the Government in the funding situation.”
He added that the "massive increase" in energy and fertiliser costs in recent weeks is "well documented" — and that these costs "cannot be borne by farmers without significant increases in the food chain being passed back to the farmer".
"While there has been some recognition by the retail sector of these cost increases in recent weeks, it is not nearly enough," Mr Cullinan added.
Musgrave Group told the the business has a "long-standing commitment to farmers".
"We invest significantly in the sale of Irish products through extensive marketing and distribution campaigns," a spokesman said.
"We are passionate believers in supporting local business and are proud to continue to support local producers across the country.
"In fact, 75% of all our goods are sourced in Ireland, supporting over 1,800 Irish suppliers.
"Our commitment to and support of farmers and farming has always been steadfast and we always endeavour to deliver the best value for suppliers and customers alike."
Aldi Ireland's group buying director John Curtin said Aldi was a "committed supporter of both Irish growers and Irish food and drink producers, paying fair prices to all its Irish suppliers".
“We have developed long-term, mutually beneficial relationships with our suppliers, pursuing a partnership approach," Mr Curtin said.
"We are currently working very closely with our Irish supply base as a result of the significant cost pressures being felt across the market.
"Our primary focus on sourcing in-season Irish produce remains.
“We will continue to shield our customers from retail increases as much as possible and provide our increasing customer base with unbeatable value.”
