Everything that goes on inside the farm gate is affected by everything that happens outside it.
The typical Irish family farm is a small business operating in a globalised market, with much of what farmers do and don’t do governed by Dublin and Brussels in tandem.
That said, I doubt that outside and global events have ever dominated the landscape of Irish farming in quite the way we are witnessing currently. In peacetime at least.
On the face of it, farming is in a good place. Prices are good across the board. That almost never happens.
True, when grain prices go up, that brings feed prices up, and that often raises milk prices. However, beef prices have been more resistant to such price pull factors, and yet beef prices are well up on last year. And lamb prices have hit levels unseen for 20 years.
What’s going on? Well, should we start with the global pandemic or the looming environmental catastrophe?
COVID-19 it is so. The entire world has been in the paralysing grip of coronavirus for a year and a half now. If the western world had become complacent about the potential of an epidemic to travel into its territory, it got a rude awakening. The developed countries with recent experience of SARS reacted quickest and strongest to events in China in early 2020, and fared best. Hong Kong, Japan, Australia and especially New Zealand have kept COVID-19 cases down.
The effect on farming, both in Ireland and across the planet, is inevitably multifaceted. Most fundamentally, at farmgate level, production has continued and life has gone on more normally than almost anywhere else.
Rural lockdown is easier to maintain than urban lockdown. Farm families have been able to carry out their work, and bring in most inputs with little disruption.
One of the main occupational irritants was the closure of marts, which evolved pretty quickly into online marts. They weren’t perfect, but farmers moved a lot of stock on when they needed to.
Processing plants and merchants’ yards operated under COVID-19 restrictions, but, crucially, with food production recognised as an essential service, they remained open throughout.
Any disgruntlement around mart and factory arrangements was tempered by decent prices.
Indeed, it’s fair to say that farmers could count themselves lucky relative to many other small businesses, particularly those in hospitality. Life could go on close to normal, livelihoods were not threatened.
Lockdown allowed many farmers and family members to work from home instead of facing daily commutes to urban workplaces. This may be a lasting beneficial outcome of COVID-19 – we now know that people can work effectively from home.
We have also found out that meetings can be held online, allowing the farm organisations to do their work in a new way.
However, those inputs I spoke of earlier have been getting dearer. Prices of fertiliser and fuel are 50% higher than when COVID-19 hit. Building supplies – timber, steel, concrete – have all gone up by as much, making farm building work prohibitively expensive.
One builder told me recently that he can only price the labour of jobs and quote the current price of the materials without any guarantee that they will be the same a month, or even a week, later.
Is this due to disruption of production, of transportation and supply chains, or a natural correction to previously strangely low prices? Probably an element of all three, but the chaos that ensued following the blocking of the Suez Canal for six days in March by the hapless Ever Given showed just how fragile global trade routes are.
Food commodities are the epitome of globally traded products, of course, and they too have risen.
I can never remember a time when all the main commodities – red and white meat, milk, grains proteins, fruit and vegetables have all been good together.
Decent prices have undoubtedly smoothed over the cracks outlined earlier, and the mood among farmers has been good through 2021.
Should we talk about the weather? Farmers always do. Of course, weather and climate are not the same thing, but our weather is the product of the regional and global climate.
Right now, the weathervane when it comes to climate is pointing close to due south, in two ways. The actual climate is changing in ways that may soon be beyond our control. While most people have long accepted the reality of global warming, there was no real appetite to do very much about it. That has now changed. The political climate in Ireland and across the EU is for significant and immediate action. The carbon footprint of farming will have to change.
Farming, like every sector, is arguing that it can only do so much, and that zero-carbon farming can happen, but it will take time.
But it is increasingly apparent that we do not have time.
It is also true that the pandemic has shown society that it is able to achieve profound change literally in weeks. And the public are more resilient than might have been previously felt.
When the Government was making hard decisions and asking an awful lot of people, we responded positively.
Not only that, the Government parties actually went up in the polls.
Recent unpopularity may have had much to do with a series of gaffes, of which Golfgate was the most significant and the Zappone appointment/party the most recent.
So can farming meet the challenge? Yes, but the pain involved will be significant. The crucial moment will be when the sectoral target is revealed. Only then will we be able to understand how steep the transition must be. At the time of writing, that piece of the jigsaw is hidden.
But all the machinery is now effectively in place. Over the last month or so, there has been a tidal wave of paper coming at farming. It is the culmination of years of work and sets the scene for the decade ahead. CAP, the national strategy Food Vision 2030, the Climate Action Bill and the Nitrates Action Plan all landed on the runway in a hectic August.
When farming gets its sectoral targets, will it then have to set its own internal sectoral targets? There has yet been no coherent farmer response to the CAP proposals. They set farmer against farmer, so that is understandable. The sector, the level of current payments and the land type being farmed will all determine a farmer’s attitude to the proposals. So how do we frame a response for 70,000 farmers, as the IFA must attempt to do? In the absence of coherence, the proposals will be enacted as the Department see fit.
The other crucial factor will be land type. One of the most contentious issues for farmers in relation to CAP over the last 20 years has been the process of mapping.
Under intense pressure from the EU, which repeatedly handed out multi-million euro fines to Ireland for being too relaxed about mapping of eligible areas, the Department of Agriculture would every year measure every bush and rock in fields on a two-dimensional map, and endlessly redraw the boundaries of eligible areas and areas of exclusion.
These same boundaries had previously been established by the same Department and accepted by the farmer in the most recent re-mapping.
The frustration farmers experienced from this endless push and pull and form the delays in payments and penalties incurred from this convoluted process often damaged the relationship with the Department.
And now, with the stroke of a pen, all this is over. Scrub can be included as eligible area. It has dawned on the powers that be that, apart from the huge effort involved in the Big Brother operation, the eligibility rules were encouraging the destruction of habitats.
Why highlight this relatively small issue in the context of sweeping changes? Because it goes to the heart of farmer suspicion of grand plans in all their detail. They see the Department as bureaucratic and pedantic. And if all the grand plans currently in gestation are to work, there has to be farmer buy-in. And for that the gears between CAP post-2020, Food Vision 2030, and the Climate Action Plan have to mesh.
We do know that the reforms to the CAP, which the then European Commissioner for Agriculture Phil Hogan was playing down back in 2018 as little more than a tweak of the system, have turned out to be fundamental.
Largely driven by the Green Deal, they represent the CAP’s attempt to make the relationship between food production and the environment the core issue directing policy and programmes.
There are three main elements to the strategy for Pillar I direct payments, accounting for €1.2bn of CAP funding annually.
Eco schemes will take 25% of funding away from direct payments towards a scheme which will probably be area-based but driven both by actions taken and measurable outcomes.
Convergence takes money from high-value entitlements and redistributes it toward low-value entitlements. This was a feature of the 2015 Ciolo? reforms. That saw 60% convergence, this time it will be at least 85%.
The third element is new. The CRISS is also a form of payment redistribution. It will enact the concept generally referred to as “front-loading”, where either 5% or 10% of everyone’s payment will be taken, creating a fund of either €59m or €119m per annum. This will then be paid out on the first 10, 20 or 30 hectares on a flat-rate basis.
The cumulative effect of these three measures will be to shift almost half a billion euro, over 40% of the overall Pillar I funding, between farmers. The big losers will be larger than average farmers with higher than average payments.
Fair enough, you might say, and that is an understandable viewpoint. The problem for these farmers, and perhaps the wider agri-food sector, is that these farmers are the full-time operator utterly dependant on farming for their income. For drystock farmers, the potential 40% cut in payments represents a cut of over 30% in income. That will be hard for them to absorb, particularly as the Ciolo? reforms made deep cuts to the payments of the same cohort of farmers over the last five years.
For farmers who milk cows, CAP payments are less of a concern, as it represents a much smaller proportion of their income.
The Nitrates Action Plan, also hot off the presses, is much more problematic for dairy farmers. A ban on landspreading of “dirty water” such as dairy washings during the closed period, combined with a proposed one-month extension to that closed period when slurry and farmyard manure cannot be spread, will increase storage requirements by about one-third. And restrictions around grazing block distance from the yard and stocking rate intensity will combine to tighten the net.
And then there is the vexed question of dairy expansion. An Taisce is seeking leave to bring its campaign against Glanbia’s proposed cheese plant in Kilkenny to the Supreme Court. Minister for Agriculture Charlie McConalogue is warning that a ceiling exists on the size of the national herd, if he hasn’t identified where that ceiling is. Suckler farmers are up in arms at a proposed support scheme that will cap their herd sizes, and see dairy farming as getting a free pass.
And, just like with everything else, the iceberg that is sectoral targets is bobbing around somewhere nearby.
Brexit and the protocol
Remember back in early 2020 when then Minister Michael Creed was describing Brexit as “an existential threat” to the Irish agri-food sector and we were all nodding in agreement?
Our understanding of existential threat has been adjusted by a pandemic and the daily footage of Canada and Siberia burning up as towns in Belgium and Germany get washed away, but Brexit remains a massive challenge.
As things stand, the NI Protocol is maintaining simplified trade on the island. As long as the protocol holds, the rest can be managed.
Following a few months of political turmoil in Northern Ireland, the summer months were relatively quiet. With the marching season over and the autumn seeing Jeffrey Donaldson’s tenure as DUP leader begin in earnest, we will see the political dynamic unfold.
Can the protocol be adjusted to allay the political concerns of Unionists and the practical trade issues that exist? Will the British government make Northern Ireland a priority as it tries to make Brexit work for Britain, a task that is proving harder than Nigel Farage and Boris Johnson himself had forecast?
It might be that the biggest British threat to Irish farming has nothing to do with Brexit at all. The British Government’s own climate change committee has recommended a sharp reduction in red meat consumption. “Our current appetite for red meat is unsustainable,” said chair Henry Dimbleby, calling for a 20-50% cut in consumption.
When you consider that the UK imports 70% of its beef, the majority of that from the Republic of Ireland, it quickly becomes obvious that such a shift in UK meat consumption will make Brexit trade issues look like a tea party (not the Boston one. Maybe the Mad Hatter’s).
So there we have it. A quick summary might be that despite the pandemic, farming is pedalling along quite well, and has coped with Brexit without disaster, in no small part due to the protocol.
However, the challenge of reducing the carbon footprint of farming is a generational one, and the instruments of change such as CAP reform and Food Vision 2030 can only be partially assessed and understood until we know the short-term sectoral targets for the sector.
And incomes lag far behind the average industrial wage, as they always have, but farmers somehow earn a living and keep their bank balance in order.
The National Farm Survey shows that two-thirds of farmers have no debt. They really are a remarkable and resilient breed, who as yet do not need to be put on the endangered list.