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Construction of a new sugar beet processing plant will begin by 2022 if Beet Ireland can persuade at least 1,000 farmers to pay €1,000 each to kickstart a new co-op.
Beet Ireland wants growers to fund a new tillage co-op which would in turn invest in a beet company, along with Beet Ireland.
With €300m required to construct the new factory, funding would also be needed from other sources like bank debt and external investors.
Farmers who invest in the co-op would be purchasing shares in the new beet company.
Farmers who want to supply beet to the new company will be required to make a further investment of around €1,000/ac.
Almost 150 tillage farmers gathered in Cahir, Co Tipperary, last Thursday to hear Beet Ireland’s proposal to revive the country’s sugar beet industry. Many of the farmers were former sugar beet growers and contractors who had previously profitable beet enterprises.
Beet Ireland director Chris Harmon described the €1,000 co-op investment as a “small level of exposure” for farmers to restart Ireland’s sugar industry and potentially reap the benefits of the value-added side of sugar beet processing.
Listen to "Tipperary farmer at Beet Ireland meeting" on Spreaker.
Harmon added that “every cent” would be refunded to farmers who contribute if the target is not reached. The €1,000 per farmer will be held by the Irish Grain Growers, ITLUS (Irish Tillage Land Use Society) and the IFA until needed.
Beet Ireland chair Michael Hoey said he saw sugar as an enabler for other products such as polymers (plastics), bioenergy (ethanol) and as an organic chemical.
“Tillage farmers have always been the underdogs and it has got worse in recent years – we are price takers,” said Hoey.
“Now is the chance to put a proper Irish farmer brand on the shelves and there is a huge pharmaceutical industry in this country which is a big user of glucose products,” he said.
Many of the speakers called on tillage farmers present to emulate their dairy counterparts by embracing the co-op model.
Beet Ireland director and former IFA beet chair Jim O’Regan told farmers: “There is no future for tillage unless we get an anchor crop in the rotation to carry that industry.”
“Dairy farmers are quite prepared to pay for expansion, why not the same for tillage farmers?” he asked.
The scale
Beet Ireland expects the new plant at Ballyburn, Co Kildare, to process 1.4m tonnes of beet per year. This would produce 210,000t of sugar and 19m litres of bioethanol. It equates to 1,000 growers growing 1,400t of beet each. Based on a 70t/ha (28t/ac) crop, this amounts to 20,000ha (50,000ac) of sugar beet.
Where?
While Beet Ireland would aim to take in most of its beet from within a 60km radius of the Ballyburn factory, Michael Hoey described this as “more of a wishlist” to the Irish Farmers Journal and Jim O’Regan stressed that all interested growers would be considered. All haulage to the factory will be by contracted haulage, with no tractor and trailer deliveries allowed.
Price
Farmers who questioned what price sugar beet would be were told Beet Ireland “does not have the answer”. Elaborating, Chris Harmon said: “We don’t know what the price of barley will be next year or in five years’ time either. The price of sugar beet will be determined by factors like the global price of sugar, the business profitability and equity dividends.”
“It’s not often you get the opportunity to get back into an industry that we should never have lost. Tonight is a chance for farmers to see the business model, and to see the good, the bad and ugly of what is being proposed.”
– Tom Short, IFA South Leinster regional chair
“I’m a dairy farmer and I always used a lot of pressed pulp. I always saw the loss of sugar beet as a natural resource being thrown away. I’m here to support the industry, we’re all part of a cog in the wheel.
“My wife and I will consider paying the €1,000 even though we won’t grow sugar beet.”
- John Lukeman, dairy farmer, Donohill, Co Tipperary
“Some answers were too vague and not specific enough for us [contractors] as an industry to move into this new Beet Ireland regime.
“Contractors would be at the forefront of harvesting sugar beet because there is no economics in this scale for farmers to get involved [in harvesting].
“At 1,000 growers with 50ac each, that’s only two days’ harvesting.”
- John Hughes, agricultural contractor, Co Kilkenny
“My customers will want to know a price per tonne and how it’s going to be harvested and delivered from 50, 60 miles from the factory, whether it will be subsidised or not. At the moment it wouldn’t be profitable from Co Wexford without a price closer to €50/t.”
- Trevor James, contractor, Enniscorthy, Co Wexford
Listen to "Tipperary farmer at Beet Ireland meeting" on Spreaker.
“I’m a grower and contractor. We used to grow 70ac of beet. I would hope it would make a season out of our operation. I need to analyse it over the next while but I probably will give [the €1,000].”
- Tommy Prendergast, Dangan, Co Tipperary
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