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What future do farmers want for farming? The fact that there is no farmer-led policy from which we can ascertain the answer needs to be addressed. Farmers must have a clear and coherent view on the future development of their sector. Otherwise we simply let everybody else decide what’s best for us.
We have no shortage of press releases from farm organisations resisting cuts to financial supports, pushing back against increased regulations and defending the national livestock herd. All are legitimate stances and critically important in protecting farmers’ interests and incomes.
But, while pushing back may slow down the direction of travel, it will not change the final destination. We see this playing out at EU and national level. The direction of policy for the past decade remains focused on achieving environmental, climatic and food safety objectives – despite farm organisations continuously raising legitimate concerns in relation to the impact on farm incomes.
As we reported last week, despite strong farmer opposition, we see an EU Green Deal continue to advance a set of policy proposals that have the potential to radically affect on-farm productivity – a 50% reduction in pesticide use and 25% reduction in nitrogen use on farms alongside a swing towards organic production.
At national level we see the future of our livestock herd continue to be used as a pawn in government talks – with little concern given towards any impact on farm incomes. Meanwhile, in last week’s Irish Farmers Journal we also learned that a central plank of the greenhouse gas reduction roadmap for the sector (the Teagasc MACC) is an effective cap on production levels.
At some point, farm organisations will have to get off the fence and make tough decisions on the CAP distribution model
As we have seen from successes of the past, if farmers are to seriously influence and shape the direction of policy at EU and national level, detailed policy positions based on solid and respected economic analysis is essential. The sole focus should not be to try to change current policy objectives. By far the best chance of success is if a farmer-driven policy can be aligned to achieving the stated outcomes – in this case improved climatic conditions, biodiversity, water quality, animal welfare and food safety.
The objective should be to ensure that the regulatory landscape and support mechanisms are in place to support delivery of these objectives while protecting farm incomes.
Successive CAP reforms have made the development of an overall strategic plan for the sector more difficult. The trend of taking money from some to give to others has created major division between sectors and those operating across a range of land types.
This is the first hurdle. It will only be overcome if the farm organisations and groups unite and accept the need for farmers to present a strategy that strikes a balance between supporting productivity and recognising environmental dividends. We will not have a thriving sector in the absence of balancing both sides of this equation.
Farming divistions
There will also be a need to address divisions, particularly between the beef and dairy sectors. The live figures presented this week by ifac showing the income divide between sectors should inform this debate. The reality is that for those looking to maximise the return from their land asset, dairying will provide a significantly higher income compared to all other sectors. The opportunity to convert cannot not be closed off to farmers with suitable land blocks in the future.
But as per the Teagasc MACC, policy is going to dictate that future growth in dairy cow numbers will require a reduction in suckler cows. Again there is a need for a mature debate on the suckler herd. The ifac figures help inform this debate with the facts. They show supports to be the main driver of profit, accounting for 80% of income on the top-performing farms. On dairy farms, the figure is closer to 20%. This should not come as a surprise. Across the world, suckling is only viable where farmers have access to scrub land or growth hormones to boost performance, or receive financial supports – which is what maintains suckler herds across the EU. Ireland is no different and it is the withdrawal of supports over the past decade that is crippling farm incomes. A reversal of these cuts will be required if we are to provide suckler and beef farmers with a viable future. The question is: where the money will come from?
Tough decisions to be made
The focus of the farm organisations has been to make demands around the future CAP budget. But at some point they will have to get off the fence and make tough decisions on the distribution model. This will form a critical part of any strategic plan for agriculture. It is easy to call for more CAP money – but how likely is it to happen and where will it come from?
As Phelim O’Neill reports, the impact of COVID-19 on member states’ economies could put further pressure on the CAP budget.
Ultimately, the main source of funding for any significant suckler support scheme will be redistribution of funds across sectors, national funding and potentially access to any new Green Deal and/or Brexit funding.
Top slicing of payments has been the preferred option across the EU. Any element of redistribution will be a thorny issue but one that could be made more palatable if there is a clear upside for any sector where there is a negative transfer.
The introduction of significant direct payments linked to a phased reduction in cow numbers would have to be aligned to the introduction of a tradable suckler cow quota. It should also be conditional on the basis that the payment is sustained and indexed linked. Any reversal in payments should see herd reduction requirement scrapped. A quota system would give suckler farmers a valuable asset that could be traded. It would also allow individual farmers maintain herd numbers at an optimal level while still achieving a reduction in the national herd. New entrants would be facilitated through a national reserve.
The easy reaction is to rail against such suggestions. But we should be clear on the outcome if we do: a suckler sector that continues to stumble from one income crisis to the next due to lack of supports and a dairy sector where growth is capped through environmental constraints.
One of the distinguishing features of Ireland since EU entry has been that farmers, the Department of Agriculture and Government have been able to develop a national strategy that has met EU requirements while continuing to support the sector. Is it beyond our farm organisations to come together to form a strategic and robust economic plan that we can present to an incoming Government? One that shows that with national support we can reinstate profitability in suckling and sheep, facilitate future growth in dairying and develop a thriving tillage sector while delivering on the environmental agenda both at national and EU level?
In this week's edition, Amy Forde speaks to farmers with designations on their lands. These farmers find themselves facing significant restrictions when carrying out normal farming activities and incurring significant additional costs without compensation.
A logical starting point to resolve it would be to question whether the core competency should remain with the Department of Culture, Heritage and the Gaeltacht. The Department of Agriculture would appear better positioned to oversee the management and responsibility for lands that have been designated and to ensure environmental schemes within CAP are aligned to supporting these farmers.
Also this week, Andy Doyle describes the EU intention to cut pesticide usage by 50% as a serious threat to tillage farming. The sector has attempted to reduce rates for decades to help reduce costs.
The EU objective is only potentially possible if we have access to gene editing technology to help provide a real alternative to pesticide requirement. Indeed, it may provide some solutions that displace specific plant protection products.
Gene editing is very different to GM technology as it is used to alter certain characteristics in what we already have to provide benefits for both the farmer and the environment.
While BEEP applications have risen, that there were only 21,750 submitted by Wednesday is disappointing. It’s less than half the number of suckler farmers in the country and poses questions about future support models. It is worth €90/cow for the first 10 cows. Anybody who hasn’t applied should do so by this Friday 15 May.
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