EU, Government decisions ‘killed off beet industry’

EUROPEAN and Government decisions left Greencore with no realistic economic alternative but to end the Irish sugar industry, an Oireachtas committee has been informed.

Addressing a meeting of the Joint Oireachtas Committee on Agriculture, Fisheries and Food yesterday, Greencore chief executive Patrick Coveney said the November 2005 decision by the EU Council of Agriculture Ministers to introduce phased price cuts for beet growers and sugar processors had the explicit aim of ending production in regions like Ireland. Furthermore, a 2006 Department of Agriculture decision to base compensation for beet growers on contracted volumes for the years 2002/03/04, rather than the most recent period, meant Greencore could not secure contracts from producers for beet tonnage for processing at Mallow in late 2006.

Mr Coveney concluded that “in a collapsing sugar market and with no certainty of access to a sugar beet crop, Greencore had no choice but to announce closure on March 14, 2006” of the Mallow plant it had recently invested €25 million in, to “avoid incurring unsustainable losses”. This led to the agriculture conglomerate renouncing the Irish sugar production quota and seeking EU compensation.

However, the company, which took over a privatised Irish Sugar Company in 1991, was strongly criticised by opposition TDs with accusations of placing profits from property speculation above jobs and farmers’ livelihoods by closing the Mallow plant, and its Carlow facility in 2005.

Labour TD and former mayor of Mallow Sean Sherlock said Greencore had shown “no sense of corporate responsibility to generations of workers and (beet) growers” in north Cork.

He added that rather than attempt to protect the sugar industry, the perception in the Mallow area was “that the sweeping hand of capitalism” was allowed to ravage the area unchecked.

Mr Coveney, who is the brother of Fine Gael TD Simon Coveney, took exception to Sinn Féin’s Martin Ferris when he condemned the company as among the “vultures” who sought to make a “quick kill” through property speculation and “capitalise on what had been a state asset”.

On the issue of the Government’s possible use of a so-called “special share,” retained during the 1991 privatisation, in order to prevent the company renouncing Ireland’ sugar quota, Mr Coveney said it did not have this capability. He added that although a 2010 EU Auditors report had found it had been supplied with out-of-date data on the industry, this was of no consequence to earlier decisions.

Questioned by Mr Sherlock on the 160-hectare former plant site in Mallow, Mr Coveney accepted that ambitious plans for a so-called Mallow West development was “unlikely” to happen as initially planned.