Feed, fuel and fertiliser are likely to push up food prices this year. Irish Fertiliser Industries (IFI), partly owned by the state, halted production at the last of its three factories in 2002. The site of one, at Arklow in Co Wicklow, is in the process of being redeveloped as a data centre.
According to the World Bank, Ireland is one of the most intensive users of fertilisers on the planet — its use grew at a compound annual growth rate of 22 per cent in the five years to the end of 2019, most likely due to the explosion in milk production.
Grassland Agro imports ingredients and then mixes them to make fertiliser in Ireland. “We use 1.7 million tonnes of fertiliser a year, and that’s when you look at all the various nutrients,” Liam Woulfe, managing director of Grassland Agro, says. “I’m buying out of ten-million-tonne factories for the nutrients we add to our fertiliser. The market is too small.”
A local fertiliser industry would still require imported gas to make the product.
“IFI wouldn’t survive today,” Woulfe says.
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Wheat tariffs put tillage farmers through the mill
For Andrew Kavanagh, a tillage farmer in Wexford who grows malting barley for Diageo, brewer of Guinness, there’s no point in growing extra wheat in Ireland because there are not enough mills to process it. Odlums, which is run by Valeo Foods, still operates one mill in Portarlington for its own products, but most of the other large factories that were operated by Greencore have closed down. Ireland depends on UK imports for its flour needs. Even before the war in Ukraine, Brexit threatened to put pressure on prices. Rules around country of origin dictate that flour mixes with 15 per cent Canadian wheat will be liable for a €172 tariff a tonne.
Figures from Ibec, the employers’ body, suggest the tariffs might increase bread prices by 9 per cent.
Kavanagh and his brother, Robert, are eager to build a flour mill in Enniscorthy. Planning permission has been granted for the project.
Kavanagh says that the mill will need government support, possibly through a Brexit capital programme.
Sugar beet sector’s bitter goodbye
Ireland’s sugar industry took its final bow in 2005, when changes to the common agricultural policy shifted sugar production from Europe to developing countries. Greencore, the former Irish Sugar Company, closed its Carlow and Mallow factories, and sold the Siucra brand to the German giant Nordzucker. Sugar beet growers took compensation rather than sell for lower prices on the global market.
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Food industry figures including Michael Hoey, managing director of Country Crest, a vegetable and grain producer, set up Beet Ireland in 2011 to create a sugar and bioethanol industry. A grower-led initiative, it did not get off the ground despite the abolition of EU sugar quotas in 2017. John Murphy, a grain grower from Co Wexford, a traditional beet growing county, says while it was a “noble idea”, it did not make sense economically: “There was no way it was going to be viable for an ordinary man to grow it.”
Aggressive price discounts at root of the problem
National statistics show that almost 39,000 tonnes of onions were imported into Ireland in 2020, while 75,000 tonnes of potatoes were imported.
According to John Hagan, purchasing manager at Country Crest, which is based in Naul, Co Dublin, aggressive price discounting and the use of vegetables as “loss leaders” to attract custom have deterred farmers from planting the crop. “We only have a handful of onion growers here — 20 years ago there was a cohort,” Hagan says.
He adds that potatoes are generally not included in the loss-leader “49 cent” category, and the number of growers has remained stable. Nevertheless, he says, times are difficult, with the price of fertiliser and fuel rising, and the prices on grocery shelves staying the same.
Ireland’s biggest food import is bananas, at about 100,000 tonnes a year.
Growing subsidies go against the grain
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Tillage farmers raised their eyebrows at agriculture minister Charlie McConalogue’s idea that grain be grown on every Irish farm. Europe and Ireland’s food security has been brought into focus by the war in Ukraine. Under the EU’s common agricultural policy, the tillage sector shrank over the past 30 years. Only 6 per cent of all arable land is used for growing grain and five million tonnes of grain are imported into the country for animal feed every year. Ollie Whyte, who farms 3,000 acres in Naul, Co Dublin, said changes to subsidies next year would make it even harder to operate. The country’s 6,000 growers work on tight margins as cheap imports from South America push prices down, and solar farms are replacing tillage farms across the country, he added.