The whole of Irish agriculture has taken a reputational battering in the last two months, as a prelude to Government formation. The beef sector has been particularly pilloried.

Part of the onslaught you could argue derives from a core opposition to meat and dairy consumption that is vegan and animal welfare driven but wrapped up in a climate change guise so as not to appear too cultish.

As expressed in the criticism of the Government's €50m beef support scheme for COVID-19 related losses in the sector, it is very clear that there is a core set of very shrill opponents of anything beef related.

Indeed this wave of opposition echoes a similar cacophony of sound generated by the announcement of the BEAM scheme in 2019 against a backdrop of similar beef price falls.

Signal vs noise

In a realpolitik context, the provision of Government support hopefully reflects a sense that the Government fundamentally accepts that the Irish economy needs all of its regional sectors to function to recover from the post-COVID-19 recession.

Indeed even a recent Irish Times poll showed that climate change ranked fourth or fifth in decision making drivers among voters. The core concern however is that regulatory policy sometimes follows public noise. What the Irish economy (not just agriculture) cannot deliver is a post-COVID-19 recovery with a heavier compliance cost structure or a negative attitude to agri food growth and development opportunities. Whether there is to be anything of a dead hand approach to agri food growth will be revealed over the next three to six months.

Other challenges

Additionally, COVID-19 recovery is not the only challenge – both Brexit and climate change represent huge challenges across all facets of the Irish economy.

Moreover, the ongoing challenge to Ireland's low corporate tax rate and the prospects of a new EUdigital tax present major challenges to the foreign direct investment (FDI) business model as it exists in Ireland.

One can only hope that the FDI/multinational sector in Ireland is as capable of adapting to a changing. Very clearly the multinational sector will itself survive and thrive, but will the Irish low tax business model survive?

Previous drivers of economic growth in Ireland such as the property and banking sectors, failed miserably to adapt their business models and had to be bailed out by the taxpayer to the tune of €45bn plus. Very clearly the FDI sector has much more depth, but the business model is under threat post COVID-19.

Agricultural strengths

The Irish agricultural sector has been here before several times. The fact that decision-making capability rests in Ireland, combined with a commitment to customer service that our export figures demand, are two core capabilities that have ensured that the agri sector has adapted to food safety shocks and fundamental policy changes including:

• The imposition of milk quotas in 1984 – Irish dairy companies (Kerry, Glanbia etc.)shifted to an export-focused approach to become huge players in pursuit of business growth and innovation in the US when milk quotas curtailed the Irish dairy growth model.

• BSE in 1996 fundamentally challenged the very existence of beef consumption in the UK/EU and across the globe, leading to increased traceability and food safety protocols which have opened new markets across the globe.

• The abolition of EU export subsidies combined with the closing off of non-EU markets challenged the beef sector in the early 2000s to transform from a largely frozen third country dominated commodity business to a fresh food business focused mainly on the UK and EU retail and food service sectors.

• CAP reforms that first introduced direct income supports and then decoupled income from production in 1992 and 2000 respectively again represented fundamental change.

• The abolition of milk quotas in 2015 again called for a change in the fundamentals of dairy farming creating new dynamics of being able to increase supply and an exposure to price volatility and world market pricing. there was also the need to find new markets for an additional 3bn litres equivalent of milk products..

• Post-quota growth has been hugely delivered with a 60% increase in dairy output and 30% increase in beef seeing in excess of €13 billion in exports and 35,000 extra jobs delivered since 2015.

Flexibility

So the Irish agri business model has extremely successfully adapted to the evolution in EU and global agri food policy. Moreover, the sector has also coped with external events and existential threats deriving from dramatic food safety episodes which unilaterally increased the regulatory costs associated with food production while never aligning price recovery with this increased cost.

Currently the Irish agricultural sector has locked in to increased global demand for sustainable grass-based meat and dairy products by adapting to change a in the fundamentals of the business of food that larger food companies in the UK/EU and across the world perhaps have not. This is good news for the prospects for the Irish economy post-COVID-19.

Good news for Irish agriculture and for the broader Irish economy where the agri food sector accounts for one in every eight jobs.