Bryan talks about voting Yes, commodity outlook and TB

IFA President John Bryan was the main speaker at the IFA's regional meeting in the Errigal Country House Hotel, Cootehill last week. Speaking to The Anglo-Celt after, he spoke on a number of issues: Bryan on EU Budget: "The biggest concern in the short term is getting the budget in place. This morning [Wednesday , April 25] I was at a meeting the Taoiseach Enda Kenny and it was top of the agenda again because the debate on the budget for the future of the Common Agriculture Policy (CAP) hasn't really got going. "We see it as vital that there is proper funding put in place so that from 2014/15 onwards for the next seven years that we have a strong CAP that will support family farming in rural Ireland. A good part of the debate from the floor [in Cootehill] was the concerns about the several deductions that [Commissioner Dacian] Ciolos is bringing in and the complications around bureaucracy and greening and the damage that can be done to the active farmer by the commissioner's proposals for a flattening [of SFP]. "There was a fairly strong consensus in the room that we had to get a level of flexibility that works for Ireland, that it wouldn't damage active farmers and would protect agricultural production but in particular, get a budget in place for both pillar one, which is the single farm payment, and pillar two which is the funding for the disadvantaged areas, environmental schemes, forestry and other areas. "There was a fair understanding last night at the meeting that these are critical negotiations that are going to be very important, because even though commodity prices are reasonably good at the moment, input prices like feed, fuel and fertiliser have rocketed over the last two years. Diesel is nearly double what it was two years ago, fertiliser is 50% higher and meal is 50-60% higher which means that farmers' major inputs have rocketed. But the one thing that sustains employment in rural Ireland is the Common Agriculture Policy and the supports from the SFP." On French elections on May 5: "That is critical for Ireland because [Nicolas] Sarkozy would have been one of the strongest defenders of the CAP ahead of the Socialist Party who are neck and neck with Sarkozy at the moment. [Francois] Hollande is still a reasonably strong defender of the CAP but not to the same extent as Sarkozy. "Late 2013 you have a German election so they are going to have to get the budget debate out of the way early next year. The two key players will be Angela Merkel and whoever is the president of France because if they don't agree a budget there will be no agreement in the first half of 2013. "What we are counting on is a budget to be put in place very late 2012/early 2013 and during the Irish presidency. The Commission are very anxious for a deal, the parliament are fairly anxious. Angela Merkel will be key to this because Germany is the biggest net contributor by far to the European budget and there's other pressures on there. That does put a little cloud of uncertainty over all the CAP negotiations when the main players that have to negotiate the budget aren't yet in a position to sit down and negotiate it." Impact on Cavan farmers: "When you think of a farmer today in Cavan is today is deciding whether to put the bull on a few more cows or to buy a few more sheep or expand his milking power, decisions of the French electorate will make on Sunday two weeks can have a huge influence. On any year the SFP and direct supports makes up a substantial part of the income of a farmer whether he's in Cavan or Romania or France or Germany. The reality is when you are farming to European standards, with the family farm, which is not 4,000-5,000 acres, it's probably 100 acres or so, and you have the European standard animal welfare and environment [regulations] and all the high costs of regulations - without the supports it wouldn't work. And it's the same in any country that has high standards and wants to have a reasonable standard of living, whether it's Japan or Switzerland or the EU or US there has to be a level of support." On voting Yes in the referendum: "I think a good strong Yes vote in Ireland - and that was the view of the meeting - will send a positive signal to Europe. We would expect that will strengthen the Taoiseach's hand in negotiations on the multi-annual financial framework. That's going to be crucial. "The IFA made a clear decision in this referendum because we feel a Yes vote is so important for stability in agriculture, inward investment and interest rates because we want to expand in agriculture and you have to have access to capital. "A stable Euro and a stable economy with low interest rates is very important to agriculture to maintain employment. They are all intertwined - stability, low interest rates and the support of the CAP." "When you talk to the farmers after over a cup of tea - most of them take the view that look the country is not in a great state, they don't expect a Yes vote to solve al the problems but they would be very nervous of the consequences of a No vote, and very much of the view in the tough negotiations we are going to have in the next few months over CAP and getting a Budget in place and getting a flexibility that works for Irish farmers how important a Yes vote is. On the Chinese market: "There are good opportunities for Ireland, especially in dairy and beef sector but there's also good prospects in the pork and chicken area. When we were in China there were contracts signed to sell substantially more pork, a lot more infant formula dairy technology, and we would be expecting in the medium term, which is probably 12-18 months that the Chinese market should open to Irish beef." On outlook for the future: "With reducing supplies of beef out of Argentina, and the US and increased cost of dairy production with higher meal costs - there are clear opportunities for Irish farmers over the next couple of years. Of course there will be the odd hiccup if the market is up or down if the market is out of balance, but medium and longer term you would have to say the prospects for food production are very good with growing world markets. "The trickle down effect can be longer than you would like. The frist part is that the dairy companies are putting more infant formaula in that will trickle down over a period because it sucks out a level of commodity and creates competition for the European retailers. "Because we still have a partial ban on Brazilian beef and the Argentinian beef and diary herd has substantially reduced - their exports out of Argentina 10 years ago were over 700,000 tonnes of beef - now they are less than 200,000 - that's a half a million tonnes less. That means when a retailer in Europe comes to Ireland and looks for beef - in the past if they were quoted a price more than they wanted they just went to South America. "That's what the Chinese markets and the growing markets in Africa create - they create pressure for us to get a more realistic price off the retailer. To see the volumes of food that will go to China in the next few years won't be huge - it will be a market that will probably build over a two three four five 10 year period so much so that you would expect in 10 tears time that there will be a substantial amounts going because it makes sense for the Chinese. Even in the short term that infant formula is a huge help to the world dairy market. It's a huge help the amount they are taking because it is creating a price for it. The pork business, the fact that we are doing increasing business in both good cuts and offals, is helping and the pig men are under severe pressure at the moment with rising costs, so getting more access to China is important. On TB testing: "There was a bit of anger over the changes the Department are implementing on TB testing rules. The interpretation taken by some DVOs (District Veterinary Office) seem to be far more rigorous than others where if a farmer adjoining you goes down with more than one reactor that they are locking you up if you hadn't the herd tested in the last four months. And certainly that's is an area where the county chairmen in most of the counties present last night - Cavan and Monaghan, and others have already met the DVO looking for more flexibility in that area. And I spoke to Minister Simon Coveney this morning. That is certainly an area, at a time where farmers are being told we have to reduce cost and be more competitive, we can't have the Department introducing over the top regulations forcing extra costs and more restrictions on farming. It's a new interpretation of the TB regulations that seems to have been introduced since January 1 and it was introduced without proper consultation. The IFA made clear as late as last September that we weren't happy with the changes and they introduced it without proper consultation. Now we are trying to get changes to it. It is important because, in some cases, the new over-interpretation of them by some DVOs is resulting in severe restrictions on some farmers."