Opportunities Available What Needs to Be Done?

OPPORTUNITIES AVAILABLE – WHAT NEEDS TO BE DONE?

“Toto, I've a feeling we're not in Kansas anymore1”

Over the last year, the Irish population has been rubbing its eyes and coming to the slow realisation we are no longer living in the Celtic Tiger Ireland of the last 15 years. Economic growth has abruptly come to a halt and the country has descended into recession. The resulting increases in unemployment, job uncertainty and the downturn in economic activity have been as frightening as they have been rapid. For young people in particular, myself included, there is an even greater shock to absorb. We may have grown up in the 1980s but we became adults during the 1990s and 2000s, and, as a result, have never personally experienced a downturn.

So how then, in early 2009, do you give a presentation about the opportunities that are available for young farmers in the future? Before doing this, I think it is necessary to look at the current situation for Irish agriculture.

1.1 Agriculture and the Irish economy To begin, let’s look at some facts about Ireland and agriculture’s contribution to the economy.

The numbers farming in Ireland have declined significantly over the last number of decades with approximately 128,000 family farms in Ireland in 2007, down from 170,600 in 19912. However, farming and the agri-food sector is still an important generator of indigenous wealth and employment in this country.

The agri-food industry is the largest Irish-owned productive sector, accounting for over 50% of exports from Irish owned manufacturing. In 2008, Ireland’s food and drink exports were worth €8.2 bn, representing approximately 10% of overall merchandise trade exports.

In terms of employment, farming, the food industry and the services industries depending on agriculture provide 300,000 jobs, more than 20% of jobs outside the greater Dublin area.

The agri-food sector has a number of characteristics that are of particular importance to the Irish economy, particularly during this economic downturn: 1. It is an industry with majority Irish ownership, which results in low profit outflow from the country; 2. Import requirements for agri-food products are 38c per euro, which is much lower than the 58c per euro of imports required for output produced by the other exporting sectors; 3. EU transfers to Ireland are almost entirely related to agriculture and rural development measures. These provide a vital source of net income for the Irish economy3; and

1 Wizard of Oz, MGM, 1939 2 CSO Farm Structure Survey, 2007 3 The Net Contribution of the Agri-Food Sector to the Inflow of Funds into Ireland: a New Estimate; DAFF 2008

1 4. The agricultural sector is widely dispersed throughout the country; thereby contributing to balanced regional and community development.

In summary, employment in agriculture and the agri-food sector in Ireland generates a greater proportion of income that stays within Ireland, than income generated in non- agri food companies.

1.2 Agriculture during and after the Celtic Tiger Over the last decade, the attraction of agriculture as a career choice fell significantly. One of the drivers of this was the availability of alternative employment in the construction sector, often in rural locations. Between 1999 and 2007, the numbers employed in the construction sector in Ireland exploded, from approximately 140,000 in 1999 to over 280,000 at its peak in 20074. This number represented almost 1 in every 7 of the total workforce, which is hugely out of line compared with other countries, and as events have shown, unsustainable.

The numbers working in construction are now falling back as dramatically as the growth, with a 22% fall in employment in the sector between 2007 and 20085.

The other major driver of growth this decade was consumer spending, largely driven by borrowing. The downturn has also led to a significant fall in consumer demand, with Ireland experiencing deflation, or falling prices for the first time since 1960.

As easy alternative employment opportunities are severely reduced, the merits of choosing farming as a long-term career option become more apparent. The challenge will be to make a career in farming sustainable throughout economic cycles and avoid a repeat of the decline of agriculture over the last decade of economic growth.

A young person entering farming, who is self-employed, has some control over his or her own career path. Of course farm incomes are dependent on volatile market conditions but ultimately it will be the young farmer’s own decisions which will be crucial in determining career progression and successes or failures.

At a national level, policymakers will be forced to realise that Ireland is a small open economy, hugely dependent on trade and that economic recovery must be driven by the wealth generating export sectors, such as the agri-food sector

In today’s presentation I will highlight the key incentives and schemes that are in place in Ireland to encourage young farmers and the opportunities these provide. I will also identify where there are shortfalls in these schemes and suggest other desirable measures that could be introduced to further encourage young farmers. In addition, I have selected two specific farming sectors, dairying and growing of biomass crops, to outline the opportunities and challenges that will be faced by these sectors over the coming decade.

Before this however, let us look firstly at the structure of the agricultural sector in Ireland today. In going forward and making proposals for the future, we need to know from where we are starting out.

4 CSO Quarterly National Household Survey 5 CSO Index of Construction Employment, February 2008

2 2. Structure of the Agricultural Sector

2.1 Age profile of farmers The picture for the Irish agricultural sector provides both good and bad news. Beginning with the least positive, the age structure of farmers is unfavourable, with the majority of farmers aged over-55.

Since 2000, there has been a serious decline in the number of family farm holders under the age of 35, which reflects no doubt the attractiveness of non-farm occupations discussed earlier.

In 2000, 13% of farm holders were aged under 35. By 2007, this had fallen to 7%, or approximately 8,900 farmers. Over the same time period, the number of farmers aged over 55 has increased from 39.5% of the farming population, to 50.5%, or 65,2006.

2.2 Structure of farms On a more positive note, the physical structure of farms has improved over the last 20 years. The average farm size in 1991 was 26 hectares. This increased by just less than 25%, to 32.3 ha, in 2007.

In addition, mobility in the use of land has increased, with 33% of all farms renting a total of 762,000 hectares in 2007, up from 21%, who rented just over 550,000 hectares in 19917.

However, farm fragmentation is still an issue, with an average of 3.5 land parcels per farm in 2007. The very high price for agricultural land over the last decade, driven upwards by the demand for development land, is a very high barrier for farmers to purchase land adjacent to their own farm. In the last year prices for farmland outside of the Greater Dublin Area have fallen by 16.1%, to just over €17,000 per acre8, which may increase the opportunities for land purchase and consolidation in the future. This is still very high relative to income that can be generated from the land.

2.3 Enrolment in agricultural colleges The total numbers enrolled in Teagasc further education agricultural courses has increased dramatically in the last number of years. In 2008, there were 621 students enrolled on agricultural courses, while in 2006, this number was only 298 students9.

At higher education level, increasing demand for agricultural courses is demonstrated by the increase in points requirements. One good example is the Bachelor in Agricultural Science in UCD, the points for which increased from 315 in 2007 to 375 in 2008. In fact the average points attained by students enrolling in this course were 41510.

6 CSO Farm Structure Surveys 2007 and 2005 7 ibid 8 Knight Frank National Agricultural Land Price Survey, 2009 9 Teagasc Education and Training 10 www.cao.ie

3 In marked contrast, demand for courses in the Built Environment has collapsed, with a fall in the numbers of first preference applications of over 31% between 2007 and 2008.

2.4 Where to now? Taking these facts into account, it is fair to conclude that agriculture in Ireland is at a crossroads. On the one hand, we have fewer young people working in the sector than ever before and the structure of farming is still quite fragmented. However, land mobility through renting has increased greatly in the last two decades.

At the same time, the numbers going through the education and training system in agriculture-related courses are higher than at any time in the last decade. There is a growing belief that agriculture is a valid and desirable career option, which provides the opportunity for controlling and developing your own career path.

At a broader level, the downturn has served to remind us that it is the indigenous exporting sectors, of which the agriculture sector is a major component, which will drive the economic recovery of this country. The Government must prioritise its policies for economic recovery based on a competitive export sector. Farming needs new blood and well-trained new entrants must be enabled to drive a market-led farming sector.

Let us look now at the challenges that are faced by a young farmer starting out in Ireland, and the incentives that are in place to encourage entry into the sector. I will outline the most positive of these schemes and the opportunities that they present, and while doing so highlight the barriers which still need to be removed in order to further encourage young people to actively choose farming as a career.

4 3. Farm Inheritance and the CAP – Barriers to expansion

Unlike other industries, almost 100% of young farmers enter through inheritance of the family farm or business. This provides a unique challenge, as the decision to pursue a career in farming requires an agreement within the family as regards arrangements for succession.

In common with many other industries, the limiting factors for business development for the young farmer who chooses to pursue farming are access to the factors of production, land, capital and labour.

Farming is a hugely land intensive industry, and so it is access to land which most often provides the greatest constraint to expansion, and development of the farm business. In addition, not only may a young farmer be constrained by the quantity of land that they inherit, but also the quality.

Finally, the farmer may be constrained, at least initially, by the type of farming enterprise that they inherit. A young dairy farmer may find his access to additional milk quota is curtailed, and often dependent on the capacity of the co-op into which they supply. A suckler farmer may be constrained by the quality of the stock he or she inherits.

A young person entering farming in Ireland must also abide by the terms and conditions of production that are determined by the Common Agricultural Policy.

Since the reform of the CAP in 2003, farm support is not linked to production. The purpose of decoupling payments was to sever the links between production and payments. The stated aim of the CAP reform of 2003 was that it would be ‘geared towards consumers and taxpayers, while giving EU farmers the freedom to produce what the market wants11’.

Effectively, it does mean that a young farmer starting out who inherits a certain model of farming now has the option to diversify this or even change it entirely, without fear of losing their income.

On the other hand, de-coupling the Single Farm Payment from production may well have had the effect of delaying retirement or withdrawal from farming for some farmers. The Single Farm Payment is now linked to the ‘respect of environmental, food safety, animal and plant health and animal welfare standards, as well as the requirement to keep all farmland in good agricultural and environmental condition12’, otherwise known as cross-compliance.

As a result, a farmer can reduce his activity levels or time spent farming, without having to forgo his Single Farm Payment. This could have the effect of reducing the overall productivity of the agricultural sector and increase the barriers for a young farmer by reducing the amount of land available. The REPS scheme may also in some cases provide a deterrent to the release of land.

11 European Commission, http://ec.europa.eu/agriculture/capreform/index_en.htm 12 ibid

5 4. Policy instruments to encourage young farmers and farm consolidation

It is essential therefore, that with a decoupled payment system, the agricultural sector has other incentives and schemes in place which will encourage land mobility and consolidation and reduce barriers to young farmers for accessing land.

Over the last decade, the taxation system in Ireland has been amended significantly to encourage land consolidation and transfer in the agricultural sector. In addition, specific reliefs have been introduced for young farmers, resulting in a supportive taxation environment for this cohort. The following section outlines briefly the major schemes currently in place.

4.1 Long term leasing A major encouragement for transferring land use from less productive to more productive farmers is the Land Leasing Income Tax Exemption scheme.

Under this scheme, landowners who lease out their land for a period of 10 years or more qualify for an income tax exemption of €20,000 per year. In the case of leases of 5 – 7 years the annual tax exemption is €12,000, and for 7 – 10 year leases the annual tax exemption is €15,000.

In addition, land that has been leased out is now eligible to qualify for Capital Gains Tax Retirement Relief, which means that farmers can now lease out land on a long- term basis secure in the knowledge that it will not negatively affect either current or future income.

The Single Farm Payment entitlement and Farm Buildings qualify as farmland for the purpose of leasing and so also qualify for Tax Exemption.

4.2 Stamp Duty Relief Stamp duty is charged on the purchase price of all property, including farmland. In the case of gifts of property it is charged on its open market value. Stamp duty rates apply on an increasing scale according to the aggregate value of the property

In the 2009 Budget, Stamp Duty rates were capped at 6% for all commercial property valued at over €80,000, including farmland.

Full relief from stamp duty applies to transfers of land and farm buildings, by gift or sale, to young trained farmers who meet a number of conditions. The recipient must be under 35 years, hold one of the required qualifications, such as the Advanced Certificate in Agriculture, remain in farming for at least 5 years after the transfer, spend not less than 50% of working time in farming and retain ownership of the land for at least 5 years.

For all farmers, regardless of age, Stamp Duty Relief applies in situations where a farmer buys land and sells land for the purpose of consolidation. “Consolidation” is defined as reducing the number of parcels of land or the distance between parcels of land and must be certified by Teagasc.

6 4.3 Stocking Relief For young farmers who are expanding their herd size, 100% stocking relief is available for their first four years in farming. In other words, the farmer can offset increases in the value of stock against his or her tax liability. This is a particularly effective and targeted measure, as it directly assists active young farmers who are building up their businesses.

4.4 Capital Taxes The Capital Transfer Tax system should allow for transfer of land without incurring penalties. Capital Acquisitions Tax relates to gifts and inheritances and applies to the recipient of the property. The current system of Agricultural relief applies to agricultural property and reduces the market value of the agricultural property by 90%. Therefore, for a son/daughter or favoured niece or nephew, the CAT relief threshold of just under €500,000 is effectively increased to almost €5 million for the transfer of agricultural property.

A major barrier to farm consolidation is Capital Gains Tax which is charged on any profit that is made on the disposal of land, i.e. the difference between the price that was originally paid for the land and the value of the land at time of disposal. Capital Gains Tax is charged whether the land is sold or not, that is it is charged when land is gifted from one individual to another, and in this case the transfer price of the land is estimated at the market value. Since Budget 2009, the Capital Gains tax rate is 22%.

The system of CGT still discourages farm consolidation and restricts the transfer of land between farmers. This anomaly should be addressed. One method would be similar to the Stamp Duty Relief that is on offer, whereby relief from CGT would be allowed if the proceeds from the sale of farmland were used to acquire other land for the purpose of farm consolidation. The relief could be subject to similar conditions as Stamp Duty consolidation relief - e.g. reduces the number of land parcels, reduces distance between land parcels, or increases the size of the holdings.

4.5 Grant Aid In addition to favourable taxation conditions, direct Grant Aid is also important for encouraging entry to and exit from farming. Installation Aid and the Early Retirement Scheme are complementary EU co-funded schemes, which support this process.

The purpose of Installation Aid is to encourage young people to establish themselves in farming through a once-off payment of €15,000. The payment is generally used by young farmers to offset establishment costs, including legal and accountancy fees. In many cases also, some of the Installation Aid payment is used as working capital, for example, as the initial collateral for a stocking loan.

The Early Retirement Scheme provides a pension of a maximum of €15,000 a year for up to 10 years and is open to retiring farmers aged between 55 and 66 years of age.

However, in Budget 2009, the suspension of applications to both of these Schemes was announced and took immediate effect.

7 This was an incredibly negative decision by the Government for the farming sector, and a backwards step for the restructuring of the industry. At the time of suspension, many farmers were in the process of applying for these schemes. IFA and Macra, in a joint submission to Government, identified over 500 farmers who are in this position.

For young farmers who are joining the sector and farmers wishing to exit, the indefinite suspension has caused great uncertainty, and introduced financial barriers that will no doubt hinder entry to and exit from the profession in the future.

In a time when Exchequer funding is limited, priority must still be given to schemes that encourage innovation and restructuring in a productive industry. The suspension of the two schemes is projected to save the Department of Agriculture less than €10 million in 2009. The long-term costs to the sector and to the economy will be greater than any short term savings enjoyed.

IFA’s position is that the decision to suspend applications to this scheme must be reversed and backdated to ensure that those affected by the temporary suspension, e.g. those who may be above the age of 35 when the decision is reversed, are not excluded.

4.6 Partnerships A “farm partnership” is a formal agreement between two or more people to farm together and share the profit generated each year. This farm business structure, particularly new entrant parent partnerships, has now established a foothold in the dairy sector with almost 450 partnerships in operation.

Under the current partnership arrangements, however, a number of disincentives exist for the partners relative to farmers farming on their own, For a number of schemes, e.g. Installation Aid, On-Farm Investment Schemes, Disadvantaged Area Payments, the maximum allowances for the partnership is the same as for the single farmer. Similarly, when two Single Farm Payments are combined, the threshold exempt from modulation remains at €5,000.

The benefits that can be achieved through entering into a partnership, for example, increased scale of production, sharing of workload, contribution of new ideas and experience etc., are largely undermined in Ireland by the loss of individual rights. The principle that farmers engaged in farming as partners are not disadvantaged relative to farmers farming as sole traders has been established and accepted in other member states e.g. France.

8 5. No man is an island - Accessing and Making Best Use of Support Services

By its nature, farming is a solitary, or small-group occupation. For a young person entering farming in Ireland, it is of great importance that they are aware of and utilise effectively all the support and advisory services that are available to them.

Interaction with other farmers is hugely important, from both a social and business perspective.

For a young farmer starting out, a business plan with a firm set of realistic projections and a vision for their career and farm development is essential. To assist them in developing this plan, the young farmer should access whatever advisory services are available to them, such as those provided by Teagasc. The supports provided by Teagasc include discussion groups, farm visits, office and phone consultations, training courses and assistance with applications for EU and national programmes to support farm incomes. For example, Teagasc, in association with Macra, provide the 3C Discussion Groups, which are targeted at committed young farmers.

At a representative level, membership and involvement in organisations such as IFA and Macra provide both social contacts with other farmers and also provide fora for discussion and resolution of specific farming issues, as well as up-to-date information on market and policy developments.

For young farmers in particular, the role of technology in their farm business will be of much greater prominence than for previous generations of farmers. A number of initiatives have been developed by the IFA, which support farm businesses using new technologies. An example of this is the I-Farm initiative, which initially was developed to facilitate farm-to-farm trading and is now expanding to become a portal for accessing many other required farm services, such as the Revenue Commissioners, Farm Weather reports, Veterinary Queries, Nitrates Calculator and other services.

A further initiative for farmers is the IFA Skillnet programme, which has been providing training and networking events since 2003, with the intention of helping farmers to make the management of their business more effective and efficient. As you are aware, IFA Skillnet is actually providing the sponsorship for today’s conference. One of the training programmes provided by IFA Skillnet is in the ‘Use of the Internet in your Farm Business’.

In order that young farmers can access online services effectively, and avoid unnecessary activities, such as having to physically travel to a Department of Agriculture Office to drop off or collect a form, it is absolutely necessary that Broadband is available in every household in Ireland. The Government, under the National Broadband Scheme has committed to having 100% coverage for the country by September 2010. This must be maintained as a priority over the coming 18 months. In addition, Government must move to deliver more online services directly to farmers.

At a personal level, my six months with the IFA has brought me into contact with farmers of all ages, from all parts of the country. I have been consistently impressed with their level of knowledge of farming, business and general economic

9 developments. On many occasions my own knowledge has been seriously tested, as there is a great appetite from among the members to know what is going on in the world outside farming, how it affects the farming community and what can they do to improve their own situation and those of their fellow members.

There are many informal and formal supports for young farmers out there, which go beyond just monetary support measures. It is a combined challenge for the young farmers himself, the advisory services and the farming organisations to develop a strong relationship, which will assist the young farmer to achieve his potential and in turn allow him contribute to the development of the sector as a whole.

As mentioned earlier, I will now look briefly at some of the specific opportunities and challenges that may arise for two very different farming sectors, dairy farming and biomass crop growing, in the future.

10 6. Traditional Sector - Dairy Farming

Dairy farming provides a market-based, full-time farming career option for a young Irish farmer today.

Over the years, the milk quota regime has always given priority access to milk quota to young farmers. Under the "milk quota trading scheme" (MQTS), young farmers under 35 who qualify as "New Entrants" get priority access to quota, and get it at a lower price. In addition, new entrants who are above 35 years who do not qualify as a NE also get priority cheap access.

The transition to the abolition of milk quota by 2015 creates opportunities for young farmers, as theoretically at least, given the right price and profitability, expanding production will be easier, without the fear of being fined for superlevy.

Young farmers wishing to enter dairying and expand their production are faced with two particular challenges. This first is the necessity to produce at a scale and with a cost-base that is competitive enough to withstand the volatility in milk prices that are and will be a constant feature of the milk production cycle.

2009 is not a good year to look at milk prices for any young farmer thinking about entering the industry. At the beginning of 2009, the best-case scenario is a milk price of 25c a litre, with production costs of 20c per litre. To generate the average industrial wage of €38,000, a farmer would need to be milking over 150 cows, with an average yield of 5,400 litres per cow. In 2007, to achieve a similar return, the farmer would have needed to milk about 50 cows, as the net margin was 15c per litre. This example demonstrates the extent of the volatility and the need for a new entrant to dairy farming to realistically plan for a scale between those, at around 100 cows.

In addition, the cost base of a grass-based dairy operation should be as efficient as possible. Capital investment is a significant part of overall dairy farm costs. Lower cost infrastructure options should be utilised. An example of this is an out-wintering pad, which is an alternative to indoor housing for the herd during the winter. In the past, there have been planning permission difficulties from certain Local Authorities. Regulatory barriers such as these are not acceptable if farmers are to be given a fair chance to develop their farm.

The second issue that will have to be addressed by young farmers expanding their milk production in the future will be the capacity of the processing sector to purchase and process the increased volumes. Processing capacity may become a limiting factor on milk production. It will be necessary for farmers, farm organisations and the co- ops to come to an agreement on how this will be resolved, with some form of contract or agreement between the co-op and producer a possible outcome.

Finally, a more efficient and less fragmented processing sector producing higher value-added product will be necessary to provide the dynamic for maximising the return to producers in the coming decades.

11 7. Diversification – Biomass Crops For Renewable Heat Generation

The role of Biomass Crops, in the generation of renewable energy and the reduction in Greenhouse Gas emissions, will receive increasing prominence in the future. Under EU targets, 16% of all energy consumed in Ireland must come from renewable sources by 2020.

The agriculture sector has a very important role to play in achieving these targets, particularly through the growing of biomass products for the generation of renewable heat. As the demand for renewable energy products grows and the technology to harness the energy potential of biomass products improves, it is expected that there will be greater opportunities in the future for farmers to become involved in the farming of these products.

Forestry is the largest biomass resource in the country with 725,000 hectares planted of which farmers manage nearly 300,000 hectares. 2,000 hectares of miscanthus and willow has been established under the Bioenergy Scheme so far and a further 400 to 500 hectares has been established outside the scheme.

At present forestry is generally not viewed as an integral part of a farm system with farmers in the past typically planting marginal land. Overall the demands on the farmer in forestry are quite low and therefore, it could be viewed as a good crop for a part-time farmer. Forestry provides a 20-year tax free guaranteed income and a farmer in REPS who plants under the Forestry Environmental Protection Scheme can earn up to €760 per hectare annually.

One of the main disincentives for forestry planting is the replanting obligation. Under existing legislation, land that is planted is forever more in forestry, which means that the farmer planting is making a decision both for himself and for future generations. In other countries, the replanting obligation is not as rigid. The removal of the obligation (with suitable safeguards) would have a positive effect on afforestation levels and on the value of land under forestry.

Bio-energy crops such as willow and miscanthus do not have the same replanting obligation and have a much shorter term to maturity (annual harvest for miscanthus and every two years for willow). The potential for income generation from willow is two-fold, with the dual function of providing bio-filtration of waste during its growth period and the production of a heating product at harvest. These crops provide more flexibility for land use for the farmer. However, their income generation potential is not yet fully realised due to the lack of sufficient scale in the demand side of the market to generate a high enough price for the product.

The Government must demonstrate that it is committed to meeting its renewable energy targets through the creation of a market for these products.

An example of how this could work is the recent proposal from the IFA for the introduction by Government of a Biomass Public Procurement Initiative to convert 25% of all public buildings including hospitals, amenity centres, offices and local development housing to biomass heating systems in the next five years. This would involve no additional capital cost to Government. If the target were achieved, the

12 public sector annual heating costs could be reduced by as much as €100 million per annum.

If the supporting environment is created by Government for sufficient income generation, I have no doubt but that young farmers will seize the opportunities presented and diversify their farming methods into bio-energy crops in the future.

13 CONCLUSION

The downturn in the Irish economy is affecting all industries. It is a difficult time for any enterprise trying to get off the ground. For the farming sector, there are challenges also.

Access to working capital is more limited than in the past, and incentive schemes have been suspended due to constrained public finances. Based on the expected Budget deficit of €18 bn in 2009, further cuts in public expenditure seem unavoidable in the coming years and the taxation system is likely to be reformed. It is of huge importance that the incentives that are in place at present for young farmers are retained.

Internationally, the size and structure of the Common Agricultural Policy post-2013 is unknown, with negotiations on the future shape of the EU budget due to commence in late 2009. The need to ensure food security, to maintain the family-farm structure, and to allow producers react to changing market conditions should be priorities in any agreement on the future CAP.

Agreement on a WTO deal will also affect the future structure and viability of the Irish agriculture sector, with particular significance for the beef, sheep and dairy sectors. The economic downturn has caused countries to look again at the need for stronger regulation and the need to protect indigenous industries. In the United States, the 2008 Farm Bill13 provides a clear signal of support for US farmers. Any WTO discussions and agreement must start from a different position than was being offered by the EU in July last year, with proper sensitive product status given to the beef, sheep and dairy sectors.

However, as a long-term career choice, farming is an attractive option. Unemployment by the end of 2009 could reach 500,000 and emigration is unlikely to act as a safety valve for job seekers, as in the past. Depending on how the crisis is managed, recovery could be quite slow. The Irish economy will return to a more stable pattern of export-dependent growth in the coming years, and the agri-food sector can be at the forefront of this recovery. For the young farmer, the opportunity is there to determine one’s own career path and development, a choice that has become more difficult in today’s economic climate for many school leavers or graduates.

Further technological advances, such as the roll-out of broadband, will reduce rural business isolation and will allow farmers to operate their businesses more efficiently than their predecessors.

Developments in both the traditional farming sectors, such as the phased abolition of the milk quota, and in newer areas, such as the growing of biomass crops, will provide opportunities and challenges in equal measure for young farmers, which were not faced by the previous generation.

As a final thought, the recent pork product scare I think demonstrated not only the major challenges that are faced by farmers but also the opportunities that can be realised in the future from seemingly negative situations.

13 Food, Conservation and Energy Act of 2008 (FCEA)

14 Consumers are already demonstrating a preference for locally produced goods in recent years, as evidenced by the growth of farmers’ markets.

During the recall, there was real anger among consumers that products they were buying were not of Irish origin, but which through deliberately misleading labelling practices, could use the term ‘Irish’ in their description. The reaction of Irish consumers, the majority of whom did not purchase the non-Irish pork products that remained on the shelves during the week of the crisis, showed quite clearly that proper Country of Origin labelling for Irish products could result in increased demand for these products.

The Programme for Government includes a commitment on the extension of Country of Origin labelling to the pigmeat, poultry and lamb sectors. Government delivery of this commitment would increase consumer knowledge and choice and in doing so would provide opportunities for young Irish farmers in the future.

On that note I will finish. Thank you for all for listening today. i

Rowena Dwyer 4th March 2009

15 i The author would like to thank Mr. Derry Dillon, Macra na Feirme, Mr. James O’Mahony, Agricultural Science Association and my colleagues in the IFA for their valuable inputs into this paper.