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The potential fodder crisis is being seriously affected by the lack of access to finance.
This was the overwhelming sentiment at the agriculture committee this Tuesday, 4 September, where Minister for Agriculture Michael Creed publicly addressed the committee for the first time since the Dáil recess.
Minister Creed sympathised with farmers and outlined how it had been a “a very challenging year for farmers including the mental challenge”.
However, deputies in attendance, particularly Fianna Fáil’s Charlie McConalogue, expressed their disappointment that the committee had not been convened earlier, despite requests to do so.
Increased spending
Given that many farmers have been feeding at winter levels during the summer months leading to increased spending, Senator Michelle Mulherin succinctly conveyed the overall mood at the committee saying: “It’s not just a question of no fodder, farmers have no funds to pay for fodder.”
Winter fodder shortage
The main sentiment was that fodder shortage this winter was almost inevitable, with deputies pointing to the 28% fodder shortfall outlined in Teagasc’s fodder survey in July potentially further stretched as drought continues in some areas.
“The situation facing us is bringing real fear to farmers,” McConalogue said.
“We’ve had a situation where we’ve had two fodder crises in the last five years but never in September have we talked about facing a winter fodder crisis.”
“You [Creed] need to be delivering another loan fund that specifically fits farmers.”
“What happens to some of those farmers that will be struggling with repayment capacity?”
“I do believe that we’re going to need a hardship fund.”
“I would point you to Germany, where the minister there has introduced a drought hardship fund.”
Farm finance
The committee also heard from the three pillar banks who stated that overdraft facilities had not increased but that they expected more farmers to seek loan extensions in the coming months.
“Our heaviest indebtedness on dairy farms would still be at the average levels in New Zealand,” Tadgh Buckley of AIB told the committee when contextualising Irish farm debt levels.
Many farmers have looked to the introduction of low-cost loans promised in the last budget as the answer to finance issues, but chief executive of the Strategic Banking Corporation of Ireland (SBCI) Nick Ashmore stated that they were still only at the “early stages” of talks with banks on a prospective scheme.
The situation facing us is bringing real fear to farmers
While deputies at the committee were quick to criticise the current situation, Ashmore insisted that the hold-up had been due to the inability of the SBCI to run two scheme concurrently, in this instance the €300m Brexit loan scheme and a low-cost loan scheme for farmers.
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