This post first appeared online at http://www.thatsfarming.com on the 22nd December 2017

If ever there is an industry that is caught between a few rocks and several hard places, it is the Irish tillage industry. Clearly, judging by the yields achieved and from general observations, the tillage side is populated by many highly capable farmers delivering some of the best production levels to be found anywhere. There, unfortunately, ends the positives.

The scale of the Irish tillage sector and tillage farms does not compare to the global players

In global, even European terms, Ireland does not have a large cereal growing area. Typically, it has been about 300,000 hectares, although the 2017 area fell to a near 25-year low of 270,000 hectares. To place the 2015 cereals area [FAO] in a wider EU context, Ireland’s cereal area is 4.3%, 5.5% and 6.8% of that in France, Germany and Poland. It is about 10% of the UK’s.

A snapshot of from 2014 shows, however, that Irish farmers are the leader when it comes to yields. Irish wheat yields were 10.0t/ha compared to 7.4t, 8.6t and 5.0t in France, Germany and Poland.

Irish farmers have compensated for a lack of economies of scale through higher yields; but that can only go so far. Judging by the annual appearance of the words ‘tillage crisis’, they are continuously squeezed by rising input costs, in part due to the small local market, and farm-gate prices linked to global prices by buyers having ready access to imported alternatives. They also sell to those who add little value and/or create products/commodities destined for, or price-linked to, global markets.

Too much reliance on selling to end users who are heavily focused on lower-value markets

The desire to ‘punch above our weight’ seems to be commonplace in the Irish agri-foods sector. Irish farmers cannot, however, compete on scale or cost [when full costs are considered]. Where the livestock sectors do try, they are fuelled by either imported feedstuffs or imported nitrogen fertilizers, or both. Yes, Ireland does have grass, but in the future, it will be more about legumes than grass per se and that will change the livestock farming landscape and its geographic emphasis.

If one accepts that the Netherlands is a successful agri-food nation, albeit one that must battle the environmental consequences, it is because of its strategic location that, i) opens to the major central European markets and, ii) has allowed the Dutch to create a massive importation infrastructure for animal feeds. They are benefits that Ireland does not enjoy. Importing to ‘buy’ production, may provide a system that can work for others, and even some in Ireland’s livestock and food-processing sectors, but it does not help those trying to operate within Ireland’s tillage sector.

For Irish tillage to have a future, does it need to exit the ‘system’ into which it is manacled?

An assessment of all livestock feeds used in Ireland [c. six million tonnes] show that around 60% is imported. For protein feeds, it is much higher. The next investigatory step needs to be a sector-by-sector analysis of the livestock industry to reveal who is using what. Such an analysis should then inform tillage farmers what, how and for whom they should be producing feed. Judging by recent incomes, they have no future producing generic feeds for those selling commodities, albeit they may be ‘premiumized’ by, amongst other approaches, the use of generic ‘Irish’ labelling.

As small-scale producers, surely Irish tillage farmers need to be targeting markets that can enhance the farm-gate price they receive for each tonne produced. Their focus must be on both yields and enhancing their farm-gate price. What value-added can be obtained if the Irish grower only sells grains for animal feeds where they are only one part of a ration that also contains imported feeds with a weaker provenance? If there is no clear categorization of feeds by source, how can Irish livestock farmers [and processors] make stronger claims about their own green credentials?

The small and shrinking tillage sector means that there are limitations on national Irish sustainability claims; not least when consumers concerns include GM crops {Argentinian soymeal] and PKE [palm oil expansion into rainforests], to name but two. Given the scale of feed imports, it is never going to be possible for all livestock sectors to use only Irish-sourced grains. With protein feeds, as beneficial as it will be to grow more pulses within the rotation, there will always be a need for imports.

Focus on consumers’ environmental concerns to enhance both products and farm-gate prices

A variety of environmental issues are rapidly coming to the fore. Organic growers have long-since responded but there are others who are adopting and developing conservation agriculture and using minimum tillage. Are they being rewarded by the market? They should be. The products and market channels need to be developed to allow this to happen. Further, there is also an argument for saying that they are seeking to deliver public goods for which they should be rewarded via the public purse.

Be highly selective and target end-users who can add-value and pay a higher farm-gate price

Hence, it makes sense for the tillage sector to become selective and to target end-users who can realistically add market value to their own products by using only fully-traceable Irish feeds.

For example, malting barley growers produce the raw materials for high-value, consumer-facing products and they need to be fully rewarded for doing so. Given the post-farm-gate structure of the sector it appears that there needs to be greater sales options for farmers. The opening of new distilleries and breweries should begin to help, so long as the independent maltings exist to complete the chain. Irish farmers need competition to ensure they benefit from provenance claims made by those who use their produce within their products and highlight it in their marketing.

Targeting buyers who can utilize Irish grains to differentiate their products and to add value to them should be the way forwards for the tillage sector. It will, however, not happen without the tillage sector being highly proactive and it will certainly not happen overnight.

The historic development of grain intakes, consolidation, drying, storing, milling and handling means that the entire logistical system is not ideally suited to handling differentiated grains. Hence, the tillage sector needs to campaign for support for it to create the infrastructure needed to enhance its flexibility to supply local, more-niche markets. In this it will need the support of independently-minded concerns operating within the post-farm-gate, cereals and protein feeds supply-chains.

For such a strategy to begin to work, the tillage sector also needs to campaign for the development of a high-value foods sector in Ireland. With the development of such, tillage farmers will have the diversified, higher-value market that they need. They need to be the key supplier of those creating high-quality, traceable and eco-friendly products. Their future does not lie in being a supplier of ‘standard’ animal feeds for those whose raison d’etre is to compete globally on cost.

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