Farm leaders insist agreement spells sector’s ‘death warrant’

A DEATH warrant for farmers and another direct hit on farm incomes on top of the Government’s own budget cuts was how farm leaders described the latest CAP agreement.

They said farmers are facing a 5% reduction in their single-farm payment due to increased modulation — the measure under which funds are transferred from direct payments to the rural development programme.

IFA president Pádraig Walshe said increased modulation would cut the single-farm payment for the majority of farmers every year for the next four years, and would amount to €42 million a year in deductions when fully implemented.

“Against the background of an extremely difficult year, and incessant pressure on farm incomes because of rising costs and falling prices, this outcome is another blow to producers’ livelihoods,” he said.

However, Mr Walshe said the outcome gives the Government the scope to make a sheep maintenance payment of at least €20 per ewe out of unspent single payment funds. There is major expectation among sheep farmers, he said, calling on the minister to make an immediate announcement.

ICMSA president Jackie Cahill said he flatly contradicted the minister’s description of the health check as representing a €170m gain to Irish farmers.

While some additional funds would be available, amounting to about €23m a year, the loss in terms of reduced farm prices — most specifically, milk prices — would be many multiples of this figure.

Mr Cahill said the actual financial loss due to milk price reductions would be of the order of €500m a year as prices fall by up to 10c a litre.

The ICMSA leader said the modulation shift of €120m from farmers’ single-farm payments over the next four years merely added to the burden which the recent budget had heaped on farming families.

He warned that the health check would turn out to be a death warrant for farmers already reeling from huge incomes cuts on multiple fronts.

Pat McLoughlin, president of ICOS, the co-ops umbrella body, said the quota increases agreed are important right steps for the dairy industry to prepare for the ending of quotas in six years. But it was disappointing that single-farm payment should be further reduced by an increase in compulsory modulation.

Macra na Feirme president Catherine Buckley said the 1% milk quota increase was welcome, despite it being a far cry from the early indications from Commissioner Mariann Fischer Boel that there would be a soft landing for the dismantling of the quota system.

“It will be critical that the minister targets part of this increased quota at new entrants and breathes new and much-needed life into the industry to address the poor age profile of only 8% of our farmers under the age of 35,” she said.