A new development approach for the fresh produce sector in the Irish Republic is recommended in a report on the agri-food industry by a parliamentary committee.
The report acknowledges that local growers are squeezed between high production costs and the power of the multiples to dictate prices, which reduces their ability to compete with imports. To tackle costs, it suggests the creation of regional clusters, with growers co-operating together and sharing both research and marketing facilities.
In addition, it recommends a system of regional branding for fresh produce, backed by Bord Bia, which it claims would establish an identification with the local community. Already, it says, restaurants and hotels in some small towns are being encouraged to stock local produce, and this initiative should be developed on a regional scale.
According to the report, the establishment of clusters would strengthen the capacity of growers to negotiate effectively with the multiples, while “branding with a local angle” would also offer growers an alternative outlet to help offset the power of retailers. At present, the only alternatives available were farmers’ markets, farm shops and box schemes.
To strengthen the growers’ position further, the report recommends the establishment of a forum of supermarket suppliers and producer groups, which “would negotiate a fair trading regime for all stakeholders”. Its role would be separate from the government’s proposed retail ombudsman and code of practice for the sector.
Arthur Morgan, one of the Dail deputies who drew up the report, said the government should be taking advantage of the current situation, with many graduates unemployed, to give the sector “an intellectual push”. It was no reflection on those involved in the industry to say that getting more graduates involved would generate new thinking and new ideas, he added, and there should be financial incentives to bring that about.
One of the weaknesses of the report, according to industry sources, is that it rejects any reduction in the minimum wage of €8.65 an hour, currently one of the highest in the EU. “Given this is such a labour intensive industry, pay is one of our major concerns, together with the cost of energy,” said one grower. “Our minimum wage is way out of line with that of Northern Ireland and Britain and has to be tackled.”
