Longford dairy farmer Mike Mangan says he is more worried now thanat any time since he started to farm 31 years ago. He explains the anxietyand concern of farmers in the first of a four-part series
Farmers are taking to the streets in protest not to enhance the unfortunate stereotype of "whingers and moaners", but as an expression of worry and near despair about their plight. There is an increasing feeling that nobody is listening.
Whatever the merits of their method of protest, however, it is important to try to unravel the many elements, from CAP reform to being ignored, which have driven them to take action.
As a dairy farmer, I am more worried now than at any time since I started to farm 31 years ago, just before we joined the EEC. The price we got for milk in the last year has dropped by 10 per cent. Add in a stock sales reduction of 12 per cent and inflation, and you can see why I'm worried.
In most professions and businesses, a drop in income is compensated for by increased output. This is not possible in dairying, as each farm has a controlled output or quota which is rigidly enforced.
This system of market control is good when prices are rising, but when we have a drop in price, a rise of about 10 per cent in production costs and a limit on production, the result is bad, giving rise to unease.
Average farm income last year, according to the CSO, was €15,000, or 55 per cent of the average industrial wage. Farmers do have a higher total income than this, but it is household income that we should compare. When we factor in inflation, we begin to see that there is an increasing gap between what farmers earn and the rest of society.
There are over 300,000 people directly or indirectly involved in agriculture in Ireland. The number leaving the land has averaged over 3,000 a year for the last 10 years, and looks set to accelerate. Imagine the impact that an announcement of 3,000 job losses would have if it was in the news tomorrow?
The fact that the job losses are as individuals, and, as a result, silent, should not lessen their importance. And when a farmer leaves the land it has the knock-on effect of the potential inheritor also not joining the workforce later.
A more difficult figure to estimate is the number of farmers who are now part-time, working off the farm in conjunction with running the farm. It is work not for economic luxury but rather out of economic necessity. From the national economy point of view, part-time farmers keep their money in Ireland.
The real question is: how important is agriculture?
This industry accounts for 10 per cent of GDP, with agricultural exports worth €7 billion per year. A unique element of this is that all of it comes back to our economy, unlike, say, the computer industry, where most of the profits go abroad. So, yes, we are very important.
WE are at a critical point in our relationship with Europe, and I admit that we have done well out of the EU to date. Enlargement and the next WTO round both mean that there will be change. How the change impacts on us is open to debate, but all commentators agree that we will not enjoy the supports as in the past.
Supports for agriculture in Europe are handled through the CAP and it is worth remembering why they were put in place.
Europe, coming from a very hungry situation in the aftermath of the second World War, needed to ensure that the recent tragedy would never happen again. It had to provide plenty of food and thus supports for agriculture were vital. The policy had the effect of keeping millions of people in rural Europe who would otherwise have gravitated towards the cities. Peace in Europe was then, and is now, a critical objective, and the sensible agricultural policy that supported farmers is a component of that objective.
No sound administration or government should ever put a policy in place that allows for a food deficit. This being so, it is inevitable that there will be a surplus; it is how that surplus is dealt with that matters.
In the past, Europe had a dominant position in the world marketplace, but we have lost this of late and allowed Australia/New Zealand to take our place. The question is: has Europe lost its nerve at the WTO?
What kind of agriculture does Europe want? The signals being sent are very difficult to interpret and are adding to the anxiety of farmers.
I think we have come to the end of a cycle in Ireland. EU entry 30 years ago brought great optimism and change. Agriculture rose to the challenge and, indeed, could legitimately claim to be instrumental in kick-starting our economic success.
The first decade saw increased output, huge on-farm investment, admittedly grant-aided from Europe, and great job-creation in processing and manufacture. Prices continued to rise in the second decade of entry, which also saw the introduction of milk quotas and a consolidation on many farms. The last decade has seen an increase in pressure on prices and a decline in profitability on most farms.
Change is inevitable, but how it is managed is critical. Farming is a seasonal profession rooted in the predictability of the seasons and, as such, radical change is difficult to comprehend. We are mainly commodity producers selling to a world market, and so we are price-takers and not price-makers.
On top of this we have first-world costs and third-world prices. Irish farms in general have limited scale at producer level and, despite being regarded as being highly efficient in a European context, many farms are caught in a classic price squeeze.
The big question for all of us is what kind of agricultural industry do we want? We need to plan for the future and define our five and 10- year objectives. We should not get drawn into a classic big versus small, farmer versus processor, government versus farmer debates.
Policies must reflect economic parameters which allow the industry to move on to the next stage; which allow committed farmers to look forward with confidence, knowing that they have sound support, both national and European.
Currently we have too many contradictory opinions as to what is needed. Two prime examples of changes which came about without sufficient thought and which have cost us dearly are: BSE, as a result of changes to the rendering process; and foot-and-mouth, as a result of trade certification rather than veterinary certification.
Consumers must always get safe food. This means that some level of support is needed, or the source of good-value food may be questionable. Necessary controls to ensure safe food must be workable and not unduly add to the frustration.
People are paying less now than ever for their food. As a percentage of household spend, food now represents 20 per cent of the total, and the figure has been declining by close to 1 per cent each year for the past five years.
As a farmer who has put my working life into an industry which I really care about, I'd like to see the next generation have the opportunity which mine had.
We have made and will continue to make a very valuable contribution to Ireland, but the industry needs youth and vigour. At the moment, too many good young people are walking away from us.