Material for Minister S Speech

OPENING ADDRESS BYMR. BRENDAN SMITH T.D.,

MINISTER FOR AGRICULTURE, FISHERIES AND FOOD

AT THE INTERNATIONAL FORESIGHT CONFERENCE

DUBLIN CASTLE, 30 MAY 2008

May I at the outset congratulate Teagasc on its initiative in undertaking this Foresight study of the Irish agri-food sector and rural economy for the period to 2030, which we are launching here to day. By bringing together all of the key stakeholders in the conduct of this exercise, Teagasc has achieved critical buy-in for the knowledge-based strategies set out in the report in the context of a long-term vision for the agri-food sector. The resulting vision of agri-food as a core element of a broader knowledge-base bio-economy accords with national and EU goals for developing sustainable knowledge-based economies. It also recognises the prime importance of pursuing new markets and promoting economic growth in an increasingly competitive market environment.

This initiative will help strengthen the strategic capabilities of Teagasc and its relevance to its stakeholders enabling it to provide proactive leadership in this rapidly changing open-market environment. Actions arising from this report will be important in facilitating the agri-food sector and the broader bio-economy to take advantage of new opportunities and to meet the emerging challenges. The findings will also feed into the ongoing national policy debate.

The report is timely. Policymakers around the world are realising the importance of agriculture and natural resources generally as providing solutions to many of the key problems facing mankind, including challenges relating to energy and climate change. Some of these factors are also reflected in the current strong world market prices for many agricultural commodities. Hopefully, this is a sign of greater appreciation in the longer term of the cost and demands of producing foodstuffs.

Food Security

Critically, we are now also entering a new debate around the issue of food security, which will serve to further heighten the importance of our agri-food sector. Food security at its basic level means both physical and economic access to enough food for an active, healthy life. But, of course, for developed countries, in particular, the concept means much more. The WHO now includes in its definition sustainability of production and distribution, the nutritional adequacy and cultural acceptability of food and the upholding of human dignity in its production.

The founding fathers of the EEC recognized the importance of ensuring the availability of food supplies at reasonable prices and provided for this in the 1957 Treaty of Rome. The Treaty objectives subsequently found expression in the Common Agricultural Policy (CAP). However, the success of the CAP in encouraging production was such as to eventually require the development of policies to limit production, a policy emphasis which has dominated the CAP over the past thirty years.

In recent times, we have seen the emergence of a growing concern at EU level and indeed globally about food security. These concerns reflect the impact of climate change, which will exacerbate existing pressures on food production; the growing use of food and feed crops and land traditionally devoted to food crops for energy uses; rapid growth in world population; and demands for higher quality diet. Indeed along with climate change, energy security and food security represent the major challenges of our time.

As a food producing nation, Ireland has a responsibility to ensure that the issue of food security features at EU level. The growing risks to the security of our food supply must be addressed in a way that ensures Europe’s own population has access to a secure supply of safe and healthy food without compromising on its responsibilities under the Millennium Development Goals to reduce poverty and hunger and maintain its international leadership in food security and food aid. This calls for research and knowledge policies. But it also demands a broader range of policies and actions that place citizens’ concerns about food security at the top of the agenda and that stimulate the production of high-quality and affordable food. At the same time we must ensure a fair distribution of rewards between the various actors in the food production and processing chain as well as protecting the environment.

Teagasc-50 Years of Research

The Teagasc 2030 project is in keeping with Teagasc’s overall mission of supporting a competitive and profitable agri-food industry that is innovative in seizing evolving market opportunities for food and non-food products and services. This ability to adjust and be proactive in responding to its changing market and policy environments has characterised Teagasc and its predecessor organisations over the years.

In this context, I wish to acknowledge that this year marks the 50th anniversary of the founding of the Agriculture Research Institute (AFT). The establishment of AFT in 1958 was critical to the subsequent development of Irish agriculture. In the presence of our distinguished keynote speaker from the USDA, Under-Secretary Buchanan, I wish, on behalf of the Government, to acknowledge the critical role played by US Marshall Aid funds in the establishment of AFT. These funds were vital in enabling the organization to set up the nationwide network of research centres and stations that were fundamental in bringing the organization close to farmers right throughout the country.

At the time of its establishment, somewhat over 60% of the total national exports were agricultural and production levels had been relatively static for a considerable period. Agricultural research activity and investment was limited. The establishment of AFT coincided with the initiation by the Government of a new programme of economic expansion in which a dynamic and developing agriculture was a basic element.

AFT responded by helping to solve the practical problems facing Irish farmers at the time. It set out to help them increase productivity and income, broadening its research activities over the years as the policy environment, market conditions and latterly growing consumer demands set new priorities for research.

Whilst maintaining close contacts with the industry, the organisation also made sure it could keep abreast of the latest advances in scientific knowledge. It developed strong linkages with universities, at home and abroad, and participated very successfully in international research programmes, particularly in the EU Framework Programmes.

The last two decades have seen unprecedented advances in the sciences that underpin agriculture and food. Our industry must have the support of scientific research at least as good as that available to foreign competitors. Iknow that AFT’s successor, Teagasc, is pledged to giving that support. Recent developments in the technology of science itself, including modern biotechnology and information technologies, mean that the potential remains for substantial achievements in agricultural science.

The Future

Globalisation, increasing trade liberalisation, climate change and the search for new energy sources are some of the major factors impacting on the agriculture and food sector. As well as meeting these challenges the agri-food industry must seek new opportunities from the unfolding developments in EU and world trade policy, from major changes in food markets driven by lifestyle and technological factors and new benchmarks of performance in Ireland's transformed economy and society. These trends are transforming the retail sector and will continue to do so for the coming decade. The development of the multi-national retail chains, with their ability to source food products of a given quality trans-nationally from across, and indeed outside, the EU will continue to increase price competition in the Irish and EU retail sector. This will put increasing pressure on the Irish food-processing sector to be competitive. On the other hand the market for Irish food companies is now global. The Food Industry Committee, established as part of the Agri Vision 2015 implementation process, has emphasised the challenges for the food industry from competitive markets, especially in terms of the cost/price squeeze along the length of the value chain. To counter this, the industry must develop a culture focused on entrepreneurship, innovation and efficiency.

The Government’s approach and commitment to the future of the sector is set out in the Agri Vision 2015 Action Plan. The 2015 Plan identifies the delivery of safe, high-quality, nutritious food, produced in a sustainable manner, to well-informed consumers in high value markets as the optimum road for the future of the Irish food industry. The 160 actions in the Action Plan form a coherent strategy for implementation, which is reinforced by the 2016 Partnership Agreement and the National Development Plan 2007-2013. The agriculture and food elements alone of the NDP will account for a total public expenditure of €8.7 billion and together they constitute an integrated package that addresses the overall developmental needs of the sector.

Science and Technology

The need for research and innovation is clear in order to respond to the challenges facing the sector. Many of the challenges cannot be addressed by a continuation of the thinking and approaches of the past. Agricultural and food research is also being asked to address issues that are both multi- and inter-disciplinary. New technologies (ICT, nanotechnologies, biotechnology, etc.) will become increasingly important. New approaches to international competitiveness will be required that place a much greater emphasis on innovation, flexible responses to rapidly changing market demands, and producing a wide range of food and non-food products and services. We will, therefore, have to progress well beyond the traditional understanding of agriculture and agriculture research to deal effectively with these demands.

The concept of the Knowledge-Based Bioeconomy (KBBE) – a sustainable economy built on renewable natural resources – is seen at international level as being the best approach to address the major challenges outlined above. This concept is at the core of the Teagasc 2030 Report.

Investment in research is pivotal to Ireland’s national development plans. The Government has greatly increased the funding to research in recent years and last year we launched the Strategy for Science Technology and Innovation, which will run until 2013. This Strategy sets out the roadmap whereby Ireland can develop as a knowledge based economy, and it explicitly recognizes that the development of a sustainable agriculture and food sector and bio economy is vital to our national economic well being. It foresees a doubling of research funding and a doubling in the number of PhD's produced. This is not a doubling for the sake of it, but rather a vision of building a capability among the best young people to fuel the knowledge economy.

I am aware that Teagasc will play its part in meeting targets for PhDs through its innovative Walsh Fellowship Postgraduate Scheme. It is appropriate that in the year we celebrate the establishment of AFT fifty years ago that its visionary first leader, the late Dr Tom Walsh, continues to act as an inspiration for future generations of high quality postgraduates in agriculture and food science.

In the past decade, we have made great strides in growing our capability in science and technology. Government initiatives such as the Programme for Research in Third Level Institutions, Science Foundation Ireland, and investment in socially and economically vital areas such as Health, Agriculture, and the Marine, have built the foundations of a world-class base in research and innovation. This has been complemented by increased investment by the enterprise sector in R&D.

Progress has been significant, but it is essential that we continue the drive to build a truly knowledge based society. Such a society will offer new opportunities for employment and social advancement. It will harness our long tradition of creativity and our talent for communication. It will bring together researchers and innovators from all disciplines, including the physical and social sciences, arts and humanities, to meet the challenges and opportunities presented by an increasingly diverse and rapidly changing world.

Growing research capability is a core component of the European Union’s drive to become the most competitive and dynamic, knowledge-driven economy. Ireland has fully embraced that challenge and this strategy represents our comprehensive plan to guide us towards that goal.

Globalisation brings increased competition and Irish farmers will require the latest knowledge, skills and research to remain competitive. The focus of Teagasc research is critical in directing the emphasis of agricultural production so as to enable farmers to achieve sufficient financial returns while also meeting the stringent environmental requirements. The focus of Teagasc research has changed substantially in recent years, while the need for production research continues, key priorities now relate to the critical areas of food innovation, safety and quality, special emphasis is placed on the exploitation of biotechnology in animal and crop production programmes and in food processing.

The 2030 Report also highlights the vital importance of quickly transferring to end users the useful new information and technology emanating from research. A new emphasis in Teagasc is recognition of the need to enable industry to access the wider world of useful information outside of Teagasc. In this regard, I am pleased to note the emphasis in the report on building on Teagasc’s key strengths. In combining the functions of research, advisory and education/training in an integrated agency, Teagasc is a unique organization and this uniqueness places it in a very strong position to play a lead role in developing an internationally competitive Irish bio-economy. It is essential that the organization follows through on the many strategies set out in the Report to take maximum advantage of its unique capabilities for the benefit of the industry and the country.

Lisbon and the WTO

We are now in the last fortnight of the Lisbon Treaty Referendum campaign and the Government and the main opposition parties are all actively campaigning for a ‘Yes’ vote which we believe in not alone in the best interests of the country but also in the best interests of Irish agriculture.

Membership of the European Union has been good for Irish farmers and successive Irish governments have consistently striven to protect Irish agriculture and the Irish agri-food sector. This Government is committed to continuing that approach, particularly in the face of challenges posed by the WTO negotiations and the recently published CAP Health Check.

The current WTO proposals present a particular difficulty for Ireland. The Irish Government’s position is clear and has been clearly articulated by a number of Government Ministers. We want a balanced outcome which does not undermine Irish and European agriculture and I and my Government colleagues have been working hard to build alliances with like-minded Member States to secure an outcome that will protect Irish agriculture.

It is important to remember is that WTO negotiations will continue long after the Lisbon Reform Treaty Referendum and Irish farmers and the Irish agri-food sector, all of whose concerns are fully shared by the Government, can be confident that this Government will continue to strive for a successful outcome to the WTO negotiations, but to be acceptable, it must be one that does not undermine Irish and EU agriculture.

Conclusion

Despite the immediate challenges to be overcome, overall the future, as set out in the Foresight is one of growing opportunity for Ireland. For example, following the abolition of the milk quota regime in 2015, our competitive dairy industry will have new opportunities for expansion. We can benefit from these new opportunities allowing our natural resource sector to continue to play a central role in the country’s economic development in the post Celtic-Tiger era.

I believe that, with the correct policies, Irish agriculture and the food-processing industries will be developed as an integral part of the knowledge-based economy in a competitive and sustainable manner. Primary agriculture will produce high-quality, wholesome and traceable raw materials for a food-processing sector that is competitive on both domestic and export markets. Farming will also support other activities and sectors in shaping the rural community, and will, in turn, draw support from these other activities and sectors. Irish food processing will focus on high-value consumer markets and have strong marketing and innovation skills.

How do we get to that point? Well, we are already on the road there. Ireland is a food trading country. The industry serves 80 million customers throughout Europe and the world. Our vision for success is focused on the objective of ensuring that the Irish agri-food sector compares to the best in the EU and in the world in terms of knowledge base, competitiveness, innovation and marketing. I note the emphasis on “innovation” and the need for flexibility in the report. This is critical and reflects the continuing need to adapt to change.