Can you tell me about the work of the Irish Exporters Association (IEA) and how it helps Ireland’s growers?
The Irish Exporters Association has been representing its members since 1951, and through its new division Horticulture Network Ireland (HNI) will continue to develop new programmes designed to identify opportunities for Irish horticultural companies, and take account of how small-scale producers can access increasingly centralised markets.
HNI is a specialist division within the IEA, which speaks directly to growers. In attempting to understand their issues and assist the sector overall, the IEA and HNI act in unison as another pair of eyes and ears for the sector regarding access to funding, training, export opportunities and updates on European legislation.
The EU is committed to persuading individual regions to form cluster groups of expertise in sectors that are producing similar products. It will become ever more difficult for individual companies to access funding and grants if they are not members of these clusters that improve economies of scale and expertise. HNI, along with our Welsh partner Horticulture Network Wales (HNW), intends to be at the forefront in the facilitation, development and training of these clusters.
What is on the agenda for the next 12 months?
Changes in market conditions require producers to change what, how and when they produce, in order to remain competitive against increasing imports and increased volumes being shipped worldwide in general. As global logistic systems improve, and as large-scale international operators become more reliable in terms of quality and traceability, pressure on Irish growers will increase.
Along with HNW, we are rolling out several information programmes. One of these is a branding information booklet specifically for the horticultural sector. It is basically a template for best practice when creating branding and logos for a new product, or simply for a company wishing to update its logo. Image is very important for the edible and amenity produce sectors, and the booklet basically explains the importance of keeping your products and branding current and up to date with new consumer trends. It will also detail the process involved in order to protect and enhance a company’s intellectual property and trademark rights on a new plant variety, product or logo.
Along with HNW, we are also in the process of undertaking a review of the supply chain and logistical issues. We envisage the end product as consisting of a supply chain and logistics information portal on the HNI/HNW websites. Growers of edible and amenity produce will be able to access the portal and improve both their cost effectiveness in relation to delivery, and reduce the time it takes to get their product to market. We are also working with private logistics providers to develop services specifically for the horticultural sector.
We are involved with HNW in producing a series of organic growing modules and technical information sheets for the organic sector. These will also be available online to growers.
These programmes have all been funded by the European Union. Having applied for a new round of funding under Interreg 4, we are optimistic of continued success in these and other planned programmes with HNW. Details of these programmes can be found on www.horticulture.ie and www.irishexporters.ie
How effective have recent promotions been in marketing Irish fruit and vegetables in the UK and in other export markets?
The Irish government established Bord Bia for the marketing, development and promotion of Irish food, drink, and horticulture. According to the latest research from Bord Bia, the Irish food marketing board, the value of edible horticulture and cereal exports increased by an estimated 18 per cent in 2007 to €259 million (£201.38m), reflecting improved market returns for Irish mushrooms.
What have been the main opportunities in the Irish fruit and vegetable sector in the last three years?
The biggest change and opportunity has been the entrance of UK multiples into the market. Dublin Meath Growers is the largest grower group in Ireland, and the acreage of fresh vegetables, salads and soft fruit grown by its members/suppliers represents some 2,000 acres. Although originally located primarily in north Co Dublin and Meath, the group now includes growers in the south and south-east of Ireland.
Around 90 per cent of Dublin Meath Growers’ produce is supplied directly to Tesco. The group has also been developing a smaller, but lucrative, relationship with Marks & Spencer over the last two years, which it hopes to develop further.
In recent years there has been more co-operation between government and non-government agencies in assisting fresh and amenity produce companies to market their products abroad. A working example of this is the group of companies who will attend the Food and Drink Expo show in Birmingham, in April.
The delegation will consist of companies which are IEA members and which are existing exporters, and also newer companies who are being supported by Enterprise Ireland to access export markets.
IEA members are at the forefront in terms of experience in maintaining existing, and creating new, export opportunities. There has also been a move towards creating value-added products. Bord Bia, under minister Trevor Sargent, has been actively promoting Irish food companies at home and abroad. The focus for the future is to increase Ireland’s market share of added-value products.
What are the key issues growers are facing?
With the advent of the ‘slow food’ movement, concerns about carbon footprints and the continuing growth of the organics sector, companies need to be able to meet new demands from the multiples and their consumers. There is a sustained growth in the number of consumers who are making purchase decisions based on both ethical issues and price. Products will have to be developed to meet this consumer appetite for environmentally friendly produce at affordable prices.
What initiatives are being taken to increase Ireland’s floral exports?
As it stands, most growers of ornamental produce do not specialise in particular areas, and this is causing problems in terms of export opportunities.
HNI is working closely with a number of individuals who are forming into a cluster of growers. Producing cut foliage products, HNI has funded two study trips to the UK and the Netherlands to assess market opportunities, and the feedback is generally positive. While it will take time to develop the cluster, an interim report suggests that both areas offer potential for Irish producers to grow their market share.
Our growers need to reduce the overall range of plants grown and concentrate on growing much larger numbers of specialised ornamental products to which our climate is more suited.
Daffodils are also an area of growth, as is the export market for Christmas trees. Going forward, we would like to be in a position to offer a number of workshops and basic information training days outlining the market opportunity to growers who are looking to specialise and diversify into the cut foliage sector.
RE-BRAND FOR SAM DENNIGAN & COMPANY
Sam Dennigan & Company is in the process of re-branding, as the Palmerston-based company has enjoyed significant expansion over the last year. The liveries have been re-designed on its fleet of Daf XF trucks and, by early May, the firm will launch its new interactive and educational Sam Dennigan and Company website - www.samdennigan.ie
“Our greatest achievement in 2007 has been further and greater expansion within the wholesale, retail, foodservice and catering sectors,” says Sam Dennigan Jnr. “We have enjoyed growing with all of our customers and suppliers over the last year, and our plans for 2008 are numerous and exciting.”
In addition to its existing customer base, Sam Dennigan has become a major consolidator of fresh produce and chilled foods to Ireland’s leading multiple retailer.
“Our national distribution centre has been expanded, as well as our product lines, driving us from the small potato-based company we started out as 32 years ago, to being a major player in an ever-expanding food business,” Dennigan Jnr says.
Sam Dennigan sources fresh produce from New Zealand, South Africa and South America. “The main purpose of sourcing products from these areas is to ensure good year-round quality and availability,” Dennigan Jnr says.
When it comes to fresh produce packaging, Dennigan Jnr says there are hundreds of companies developing new and improved, cleaner, more environmentally friendly packaging. “Everyone needs to start sourcing the right solution for them - but sooner rather than later,” he adds.
Sam Dennigan became a member of Repak in 2007 and, since then, the company’s waste levels have been dramatically reduced due to the special care that is now given on a daily basis to its waste-management system.
The company invested heavily in its IT operations throughout 2007, and will continue to do so this year. “We are acutely aware of the critical role that technology plays in the procurement, production and distribution of fresh produce in today’s marketplace,” Dennigan Jnr says. “Real-time inventory, live, up-to-the-minute produce availability and daily profitability, coupled with proper business planning and business intelligence, are key factors that help us drive out the costs from our business.”
Sam Dennigan has been working closely with the people behind the benchmarking Pr2 system, and has upgraded to its latest MS Windows technology-based applications. “I believe this has made us the most sophisticated users of information technology within the fresh produce sector in Ireland,” Dennigan Jnr claims.
NO REGRETS, SAYS 100-ACRE GROWER WHO QUIT
A year ago, Declan Kerrigan was supplying two supermarket chains with field vegetables from his 100-acre farm in the heart of the north Dublin horticulture sector, following in the footsteps of his father and grandfather, writes Anthony Garvey.
Today, he works as a manager at a neighbouring farm, taking home a weekly wage, while the family holding in Rush, where he had produced cabbages and leeks for 25 years, is leased out to another grower. “I have no regrets,” says the man who walked away, angry and frustrated by the endless haggling with multiples over prices.
The turning point came when he sought a 10 cent (6p) increase per head for his cabbages. Tesco and Superquinn refused, he says, claiming they could get supplies more cheaply from abroad. “It was the final straw. My costs were going up and I just couldn’t cover them. If I had stayed in the business, I would have gone bankrupt. So I quit.”
Ironically, the two chains conceded a price rise when his departure became a national news story. But it was too late for Kerrigan, who had already sold his stock. Now, he watches with bemusement as the same price battle is being played out again between the supermarkets and the Irish Farmers’ Association (IFA).
This time round, the 80,000-strong IFA is pulling no punches. In a series of hard-hitting national newspaper advertisements, it “names and shames” the main retail groups - Tesco, Dunnes Stores, SuperValu, Superquinn, Lidl and Aldi - for what it calls their “predatory pricing” of fresh produce, and particularly their use of cut-price vegetables as loss leaders.
The campaign warns consumers: “Don’t be fooled - farmers cannot produce two for the price of one. Supermarkets keep their margins, while discounts come out of the growers’ pockets.” To hammer home the message, the IFA organised a rally outside a Tesco flagship store in Dublin to protest over the “disastrously low prices” being paid to potato growers. IFA president Padraig Walsh warned that 500 growers had gone out of business in the past five years because they could not survive on the prices being paid, and that more would follow unless returns improved.
So far, the only response from the supermarkets has been to deny the predatory pricing claim and to challenge the IFA to take its case to the Competition Authority. But Kerrigan, a casualty of the earlier battle, says the campaign must be maintained and intensified, if possible. “Keep on embarrassing them,” he advises, “it’s the only way to get results. If we don’t win this fight, we could lose the next generation of growers.”
However, it would be wrong to portray the Irish fresh produce sector, with a farm-gate value of around €350 million (£274.3m), as a war zone, or a grim struggle for survival. There are problems, and there have been failures, but the industry has also benefited from consolidation, specialisation and increased mechanisation.
Latest statistics show that 4,267 hectares of field vegetables were produced in 2006, virtually the same figure as recorded four years earlier. The number of growers has declined, but the top 50 now account for 70 per cent of output, and their areas of production have increased by 28 per cent over the past four years.
Nor are all producers at war with the multiples. At Country Crest, a company set up 14 years ago by brothers Gabriel and Michael Hoey on the family farm in Lusk, north Dublin, they sing the praises of Tesco for the market stability it has brought. The company supplies the chain with 250-300 tonnes of washed and graded potatoes a week, and has a network of growers in Dublin, Meath, Wexford and Donegal to meet the order.
“I know that some growers are having a tough time,” says Tony Doyle, the company’s commercial director, “and some I know personally have departed the market, but our growers are very happy with what they are being paid. Before Tesco arrived, the potato market was fragmented and unco-ordinated. Now, we have stability and the money for investment in premises and equipment.”
Supply deals for onions and carrots have also been negotiated with Tesco, with specialist growers chosen. For some months of the year, the company has to bring in onions from New Zealand and carrots from Scotland and France, but intends to reduce these imports significantly through building up its local grower network.
In another initiative that will cut imports and help the environment, Keelings is now supplying the Irish market with peppers grown at its north Dublin farm centre. The market, worth around €30m and increasing at 20 per cent a year, has been supplied for the past 30 years through imports from the Netherlands and Spain, so the home-grown produce will mean a considerable saving on air miles.
Of all the initiatives, perhaps the most important for the sector has been the appointment of 47-year-old Trevor Sargent as horticulture minister. A former Green Party leader and keen vegetable grower, who represents the north Dublin constituency - the heart of Irish horticulture - it was his dream job, and he is relishing it.
He has brought an almost missionary zeal to the office, constantly urging his parliamentary colleagues, as well as the public, to eat more vegetables - and even offering tips on how best to cook Brussels sprouts. He has championed farmers’ markets, streamlining the regulations to make life easier for local producers, and has declared his ambition to increase the Republic’s organic production from an acreage of under one per cent to five per cent by 2012.
He frequently reminds colleagues in parliament that “40 per cent of this country’s field vegetables are grown in my constituency”, which means he is all too aware of growers’ price grievances. He has spoken out in support of their current campaign, and is on record, during his time in opposition, as saying that without a 25 per cent price increase, the industry could collapse.
According to some unconfirmed reports, he has already had talks with supermarket managements in a bid to resolve the current impasse. Whether true or not, what all growers acknowledge is that his commitment and enthusiasm has raised morale across the sector at a very testing and difficult time.
STERLING CLOUD THREATENS IRISH MUSHROOM INDUSTRY
The Irish mushroom sector, long the poster boy of the country’s horticulture industry, is wilting under a cloud right now - a sterling cloud, created by the continuing fall in the value of the currency against the euro, writes Anthony Garvey.
“It’s dropped in value by more than 13 per cent since the middle of last year,” says Brian O’Reilly of Commercial Mushroom Producers (CMP), the representative body for Irish growers. “When you consider that more than 80 per cent of Irish mushroom production goes to the UK, you can appreciate just how big a blow that depreciation is for growers.”
According to O’Reilly, over the past decade Irish producers have invested heavily in facilities to reduce costs and become more efficient, but that is now being put at risk through a currency crisis that is beyond their control. “As primary producers whose only access to the consumer is via the supermarket shelves of the multiples, we are entirely at their mercy, or whim, on whether we survive or not.”
O’Reilly claims that a “double-digit price increase is needed immediately” to ensure survival. He is hopeful that something positive will emerge from behind-the-scenes negotiations, and sees a recent retail price increase by Tesco as an encouraging straw in the wind. “The trouble is that the big chains, particularly Tesco and Asda, are watching each other so closely that one won’t move unless the other does,” he says.
The fall in sterling is just the latest - and worst - of the difficulties besetting the industry. At home, soaring oil prices, an inflation rate of five per cent, the highest in the EU, combined with a minimum wage of €8.65 (£6.78) an hour, the second highest in the EU, and stringent regulations on employee working conditions are all taking their toll on costs.
This year, too, the EU’s nitrates directive, limiting both the times and the quantities of spent mushroom compost that can be spread on land, will take full effect. “For some growers, it will mean having to invest in concrete storage facilities, which could cost between €30,000 and €100,000,” says O’Reilly. “Finding that sort of money in current circumstances won’t be easy.”
The Irish mushroom industry, with a farm-gate value of more than €100 million, once dominated the UK market. Today, however, Irish growers face stiff competition from the Dutch, who have been displaced from their traditional continental markets of France and Germany by the Poles, now set to become Europe’s leading mushroom producers.
While the Dutch, as members of the euro club, face the same sterling problems in the UK market as the Irish, they have a considerable advantage with their cheaper compost. However, the greater long-term threat to Irish market share, and to prices, comes from Poland, which has much lower production costs and is already making some inroads into the UK, despite the disadvantage of having to transport perishable produce over a much greater distance.
In the 20-plus years that it has taken to build the Irish industry, the secret of its success has been adaptability and resilience. The number of growers in the sector may have fallen from 500 in 2000, to just 100 six years later, but the output has remained fairly constant at around 60,000 tonnes a year, as producers consolidate and adapt to new methods, greater mechanisation and new technology.
It was the Irish who pioneered the satellite growing system, using a network of local producers and a centralised composting facility. Now the Dutch shelf system has been adopted, offering increased production with a less labour-intensive operation. There has also been an increased use of phase 3 compost, instead of phase 2, with the aim of improving yields.
“Mushrooms are still the most important sector in Irish horticulture,” says Dr Helen Grogan, a senior research officer with Teagasc, the farm advisory service, “and despite the current difficulty over sterling, I’m confident about its future. Its main export market will remain the UK, which imports around 100,000t of fresh mushrooms annually.
“The key for Irish growers is to keep costs down and become as efficient as possible, so that they can compete effectively with the Dutch and the Poles.”
Grogan cites the success of Harte Peat, a small county Monaghan company that exports mushroom casings around the world, as evidence that the Irish industry can compete with the big boys at international level. The company, which produces casings from an innovative soil mix, recently signed a deal in South Africa that could see it supply a third of that country’s mushroom market.
Some 80 per cent of production is exported, and the company’s markets stretch from Australia to the Netherlands and from Iran to Colombia. “Like everyone else, we are feeling the strain over sterling’s continuing fall against the euro,” says sales and marketing manager David Austin. “But we don’t suffer too much, as less than 10 per cent of our trade is with the UK.”
Last year, a consultants’ report commissioned by Bord Bia recommended a promotional drive for Irish mushrooms in the UK to offset the threat from Dutch and Polish imports. Such a promotion was overdue, it said, as the last one had been carried out 10 years ago. The report suggested it be conducted by Bord Bia, with the support of the Irish industry and in collaboration with British retailers. So far, however, the initiative has failed to materialise, with reports of difficulty over funding as Irish exchequer finances deteriorate.
However, the doom-and-gloom mood of some in the industry gets short shrift in official quarters. A recent share-out of state grants for the sector brought a flood of applications. “I was surprised by the numbers and the standard of the applications,” says Noreen Cunningham, horticulture officer in the department of agriculture. “Like everything else, mushroom growing is a business, and you don’t apply for grants and put together development plans if you think the sector is on the point of collapse.
“Given my experience, I would be quite optimistic about the future. This industry is very resilient.”
CMP’s Brian O’Reilly agrees: “Of course we’re a very resilient industry - we’ve had to be to survive. But there comes a time when resilience isn’t enough. We’re pretty close to that point right now.”
KIDS TURN GREENGROCERS WITH REDBRANCH
RedBranch, the County Clare-based not-for-profit organisation, has ambitious plans for its School Fruit Microbusiness. The scheme, where children become greengrocers and sell fruit to other schoolchildren, was initially trialled in Scarriff Community College in County Clare three years ago. RedBranch hopes that by 2011, some five per cent of schools in the Republic will have signed up to the scheme.
RedBranch is currently working with four suppliers in the Limerick and Clare areas, says David Egan, ceo. “We are negotiating with Total Produce, and hope that it will begin supplying schools in the near future,” he tells FPJ.
Egan says that unlike the UK, very few schools in the Republic of Ireland have canteens, and a lot of junk food is sold in schools. “It’s easier for Jamie Oliver to have an influence in the UK with its history of canteens and dinner ladies, but in the Republic, we’re starting from scratch and are working on a school-by-school basis,” he says.
“A big part of what we are trying to do is to improve fruit consumption among children, both in the school environment and at home,” he continues. “We are at the stage where children eat even fewer fruits and vegetables than their parents, and it’s important that we help change people’s attitudes.”
A lack of availability of fresh produce and lacklustre demand has been blamed on poor consumption, but Egan warns that the fresh produce industry could be in for a shock if consumption patterns do not change.
The School Fruit Microbusiness scheme has already received significant support, and schools have reported an improvement in behaviour as more children consume fresh produce.
“RedBranch’s aim is to promote healthy lifestyle choices in Irish children and young people,” Egan says. “We work with schools and parents, and act as advocates for healthy food and physical activity choices.”
Egan says the changes in the retail and wholesale sectors could affect the distribution model of the scheme, and notes that although Ireland has seen big growth over the last 15 years, infrastructure has failed to keep pace.
IRELAND BUILDS ON GREEN CREDENTIALS
Ireland needs to build on its green and clean image when educating UK consumers and retailers about Irish-grown produce, says Joseph Blair, programme manager for the Irish Exporters’ Association and director of its horticultural division, Horticulture Network Ireland. “Ireland grows fresh and healthy produce, and there has been a huge surge in the number of producers of artisan food products and crops,” he says. “Larger food producers may have something to learn from these smaller producers, as they have been very successful in developing and marketing their products at home and abroad.”
Blair says that Ireland’s close proximity to the UK means that it shares a relatively equal carbon footprint. Now more than ever, consumers are taking the time to check labelling for origin of produce and food miles, and Blair argues that these issues, as well as ethical production techniques, have become tools used to convince the public of a product’s green credentials.
He adds: “The horticultural community needs to build efficiencies into its production methods in order to remain sustainable and competitive in the coming years.”
Opting for environmentally friendly energy sources such as wind and solar power could aid the sector, and Sustainable Energy Ireland is giving both technical and grant assistance in order that all businesses can reduce their reliance on carbon-producing fuels.
“Recycling, reducing water usage and reductions in pesticides not only keep production costs down, but also enhance products’ green credentials, making them more appealing to the public,” Blair says.
BLOOMING SALES
Floral specialist Denise Clarke Flowers has enjoyed increased sales over the last 12 months. “We’re getting more companies to supply us, and we’ve seen larger numbers of customers from privately run shops,” owner Denise Clarke tells FPJ. “This business is always changing, and it’s important to go with the flow.”
Valentine’s Day and Mother’s Day are key dates for the floral calendar, and this year was no exception. “Both dates are always very important, but what we noticed this Valentine’s Day was that more customers were choosing mixed bouquets of flowers, rather than just the traditional red roses,” Clarke says. “Mother’s Day fell so early this year, right at the beginning of March, but it was a very good one for us.”
St Patrick’s Day can also be an important date, but Clarke says sales are normally limited to shamrocks.
Clarke set up her business in the mid-1990s and sources plants and flowers from Ireland, the Netherlands and Denmark. As well as supplying shops, garden centres and corporate events, Denise Clarke Flowers’ products have appeared in television shows including Rough Diamond and Murphy’s Law, and films such as The General and The Boxer.
IRISH GROWERS GENERATE TRUST IN ORGANICS
Established in 1991, The Organic Trust now certifies the majority of the commercial organic horticultural producers in Ireland. These include household names such as Philip Draper, Denis Healy, Gold River Farm and the County Wexford Organic Centre.
The advent of farmers’ markets and an increased focus on buying local produce has encouraged many new Irish growers to look at converting to organic production, says Helen Scully, national co-ordinator and certification manager of The Organic Trust Ltd.
“Over the past two years particularly, more growers than ever before have registered their holdings into organic conversion (an increase of 28 per cent on previous numbers) - many of these are smallholders who will be supplying organic produce to local markets,” she tells FPJ. “Many of the large-scale conventional growers continue to display a reluctance to convert to organic production, but The Organic Trust is confident that the information and technical resources now available will encourage the more commercially minded conventional growers to convert in the coming months.”
Moreover, the advent of government-sponsored Organic Demonstration Units has helped in dispelling the myths about organic production and, according to Scully, is an extremely valuable resource in helping conventional growers obtain the information they need to make an informed decision.
A number of developments in recent years have had a major effect on organic fresh produce in Ireland. “The explosion of farmers’ markets has made a real difference to the small-scale producer, who could never have addressed the supply and demand requirements of the multiples,” Scully claims. “Farmers’ markets have also facilitated the consumer in speaking with the producer, and this has allowed growers to plan their crops based on actual consumer interest, as opposed to marketing thinktanks.”
In addition, the multiples have seen demand for organic produce grow sharply within the sector. “You only need to look at the amount of focus the multiple advertisers place on their ‘organic credentials’ in their advertisements,” Scully says. “All multiples now have a reasonable organic offering, and the organic section in all supermarkets (even the discounters) is constantly growing.”
The Organic Trust has also noticed and welcomed the trend of health-food shops to begin offering organic fruit and vegetables. The trust works with many of the leading health-food stores to achieve compliance to organic standards (a requirement for all those wishing to sell loose organic produce).
Through its involvement with the Organic Marketing Development Group (a sub-section of the ministerially appointed National Steering Committee for the development of the organic sector in Ireland), The Organic Trust works closely with Bord Bia and the department of agriculture, fisheries & food in producing information leaflets, and organising organic events such as the National Organic Conference on September 4 in Waterford, and National Organic Week, which will run from September 15- 21.
“Setting up a National Organic Week was something that the Organic Trust had lobbied about for many years, and we are now delighted to be involved in helping organise this and supporting those of our members who are holding specific events during the week,” Scully says.
Furthermore, the trust provides regular information briefs to all sections of the media interested in discussing organic food, and also attends food shows such as Rude Health, Greener Ireland, Bloom and many other events aimed at the consumer.
Organic Trust members open their farm gates to the public to see what is involved at grass-roots level with organic production. “Organic food is here to stay, and at current growth rates is going to replace a significant percentage of the fresh produce we eat every day,” Scully says.
Government intervention is needed to encourage consumption, says Scully. She explains: “In parts of Italy, all fresh produce and pasta dishes served in schools have to be certified organic. Similar programmes are run in many countries throughout Europe at differing levels - Ireland is probably alone in having no policy of public procurement when it comes to organic food - at least not yet! But we are hopeful this will be addressed in the not-too-distant future.”
Hospitals could also offer an excellent starting point, and Scully says that even one offering a day of organic produce would have a significant effect on the growth of the organic sector in Ireland.
According to Scully, any organic grower will tell you their biggest investment is time; there are not enough hours in the day to attempt to fulfil their customers’ demands. “However, most growers make a reasonable income from their work and, like any successful business, a significant proportion is ploughed back into the enterprise,” she says. “Significant grants are available for organic growers through the department of agriculture & food.”
There are, however, questions of scale. Organic growers are by nature smaller landowners than their conventional counterparts, and producing organic food is more labour intensive, as synthetic pesticides or herbicides are not used.
Nevertheless, Scully says that one only needs to look across the Irish Sea to witness farms that are bigger than 300 acres that are successfully growing organic produce in an organic system.
“Many of these were large-scale established conventional producers who saw the business opportunities organics held for them,” she continues. “We need that here in Ireland - a little more vision, and a little more trust; and we need some of our larger conventional farmers to be as enterprising as their UK counterparts.”
A greater offering of home-grown produce would see a huge rise in sales, and all the benefits that this would have for the industry as a whole, according to Scully.
Trevor Sargent TD, Ireland’s newly elected minister for food & horticulture and a member of the Green Party, has set ambitious targets for land conversion to organics in the country.
When questioned about the opportunities for organics, Scully says that although Ireland lags some way behind the rest of Europe, the country is still seeing significant growth in all sections of organic production.
“If Ireland is to achieve sales in organic food that match the European average (and there is nothing to suggest it will not), then there is still huge potential in this market for growers, producers, processors and retailers,” she says.
RETAILERS TIGHTENING THEIR GRIP ON MARKET
It is the battle of the multiples in Ireland’s retail sector, as the larger operators look to tighten their grip and extend their sphere of influence. With more consumers looking for home-grown food, retailers are keen to emphasise that they are supporting the Irish fresh produce sector.
Marks & Spencer has been targeting Ireland aggressively since the mid- noughties, and says it has been working with Irish suppliers since 1968. The retailer sources from more than 20 Irish suppliers, producing over 250 products. It handles Bramley apples grown in the orchards of County Dublin, carrots are produced in Comber on the Ards peninsular and the retailer sells Irish strawberries and raspberries during the summer months.
Tesco claims to be Ireland’s leading food retailer, operating 101 stores across the country. As an independent subsidiary of Tesco plc, the company has been trading in Ireland since 1997.
In 2006-07, Tesco reduced the price of over 10,000 grocery items previously controlled by the groceries order, in what was the biggest price reduction campaign in the history of Irish retailing.
“Doing business with the Irish food industry and supporting the local economy have been very much part of the Tesco ethos in Ireland,” claims Tesco. “We are the largest single buyer of Irish food products in the world, spending an aggregate of over €1.28 billion (£998 million) on Irish products and services annually, and 50 per cent of our food range here is produced in Ireland.”
Superquinn says its presence is mainly concentrated in the Dublin area, but it is also expanding nationally with shops in Kilkenny, Carlow, Clonmel, Dundalk, Waterford, and most recently, Limerick. In 2006, Superquinn announced that it would be ploughing €100m into its investment and expansion programme, and one of Superquinn’s most recent openings was a 10,000sqft store at Rathborne Village in Dublin.
German discount chains Aldi and Lidl are also expanding rapidly. Aldi has more than 45 stores in Ireland, while Lidl opened stores in Donegal and Dublin earlier this year.
SuperValu is part of Musgrave SuperValuCentra, the retail franchise division of the Musgrave Group, Ireland’s largest grocery and food distributor. Irish companies produce more than 70 per cent of all products stocked at SuperValu.
In recent months, a number of larger multiples have been criticised over claims that they are increasing their own margins at the expense of farmers and consumers.
Tesco, Superquinn, Aldi and SuperValu have come under fire over claims by the Irish Farmers’ Association that they are using fruit and vegetables as a loss leader.
The IFA says that farmers are being exploited by supermarkets when special offers are made below the cost of production, and adds that such practices are endangering the Irish potato, vegetable and fruit sectors.
However, Aldi Stores (Ireland) says that farmers and growers are not shelling out for the cost of promotions. SuperValu and Centra have also said they are committed to ensuring farmers get a fair price.
Retail Ireland, which represents the Irish retail sector, has rejected the IFA’s allegations as “groundless”.
DIVERSIFICATION FOR IRISH WHOLESALE SECTOR
The Republic of Ireland’s wholesale sector is adapting to meet changes in the marketplace, say well-placed sources. Certainly, as retailers, in particular multiples, become ever more aggressive as they fight for a greater slice of the fresh produce pie, wholesalers are upping their ante.
The main change in the wholesale sector in the last 12 months has been the movement of some traders to specialise more in catering services than in wholesaling, says Sam Dennigan Jnr of Sam Dennigan & Company.
As a result of an expanding retail market, growth in the foodservice sector and a movement towards centralised distribution across all multiple groups, there has been a decline in the amount of sole traders in the fresh produce business.
Companies who once specialised in fresh produce have now diversified to include other items in their portfolio, such as cooking oils, dairy products, cooking materials and even ready-made meals, Dennigan Jr says.
Sources say wholesalers are responding to increased demands from the catering sector, and tailoring their services to meet their clients’ needs.
Meanwhile, although a formal decision has yet to be made on the relocation of businesses in the Dublin Corporation wholesale market, changes are afoot for the market site.
Architects HKR, Make and Gehl have joined forces to re-design and develop the area, near the Four Courts, north of Dublin’s River Liffey.
The collaborative team has come up with a proposal to revitalise the area with retail and wholesale markets, residential and office accommodation, as well as food shops and restaurants. The fruit and vegetable market is to be at the heart of the site, and will be preserved within an upgraded structure.
The winning proposal also aims to make better use of Dublin’s light rail network, the LUAS, to connect the area to Dublin’s city centre and the Temple Bar area.
The Markets Regeneration Consortium is carrying out the re-development, which forms part of Dublin City Council’s Markets Area Draft Framework Plan.
Denise Clarke, owner of Denise Clarke Flowers, says a few companies have moved out of the wholesale market to their own premises in the last 12 months. A couple of others have also retired, although just over 20 firms continue operating in the market.
One noticeable change in recent years, however, has been that wholesalers are delivering more to their customers, rather than customers coming to the premises. “It’s difficult to park here, especially early in the mornings, so it’s easier for wholesalers to go out to deliver,” Clarke explains.
