Action Needed from Govt and Lamb Factories to Improve Sheep Farm Incomes

Speaking at the weekly sheep sale in Tuam Mart Co Galway today, IFA President Joe Healy highlighted the income difficulties on sheep farms across the country.  He said strong action from Government through domestic and EU supports, along with higher lamb prices from the factories, are needed to secure this very important farm enterprise into the future.

Together with IFA National Sheep Chairman Sean Dennehy and sheep farmers from the Connaught region, Joe Healy said “The sheep sector is going through a very difficult period. Compared to 2018, this season’s lamb prices are down 43c/kg or €9 per lamb, mainly due to the impact of Brexit in the UK”.

The Teagasc National Farm Survey shows that incomes on sheep farms in 2018 were €13,297. Ewe numbers at 2.56m are down 86,000 head in the December 2018 sheep census.

Joe Healy and Sean Dennehy outlined a set of actions on prices and policy that are required to restore farm income and confidence back into the sheep sector.

IFA is pushing for increased targeted payments for the sheep sector from both domestic funding and CAP supports. “IFA is campaigning for targeted direct payments of €30 per ewe for sheep farmers.”

“Through strong lobbying, IFA secured funding of €25m pa for the sheep welfare scheme in 2017, worth €10 per ewe. Only €19m pa is being drawn down. IFA is proposing that Minister Creed amends the scheme and provides more options and funding for farmers to increase the payment to €15 per ewe for 2020 and also extend and enhance the scheme for future years.”

On CAP, Joe Healy said Minister Creed must fully protect the CAP Budget and secure an increase to cover inflation and any extra costs on farmers. He has to start with reversing the €97m cut proposed for Ireland. “The CAP Strategic Plan for Ireland must prioritise vulnerable sectors like sheep. Coupled payments as well as targeted ECO schemes must be considered in Pillar I”.

On the Rural Development Plan in Pillar II, the IFA President said sheep farming makes a significant socio economic and environmental contribution to rural areas and especially in hill and mountainous regions, where other types of farming are not possible.

“IFA has proposed a €10,000 environmental scheme in the new CAP with higher payments for Designated and Commonage land, as well as increased funding for ANCs (Areas of Natural Constraint)”.

On prices and the market, Sean Dennehy said lamb prices need to rise and access to the Chinese market is critical. He called on Minister Creed to prioritise this on his visit to China this week. “Access to China has dramatically increased lamb prices in New Zealand and Australia over recent months.”

On trade deals, Sean Dennehy said “Having messed up on the Mercosur deal for beef, the EU Commission cannot contemplate another bad trade deal on agriculture with New Zealand and Australia, which already have access for a massive combined volume of 247,440t of lamb imports into the EU market”.

“Lamb supplies are tightening and factories need to increase prices. Some factories had imposed severe weight and fat penalties and others had enforced excessive charges, which are as ‘way over the top’”.

Sean Dennehy said IFA is demanding that the factories introduce a strong Quality Assurance bonus of 30c/kg on lamb as the current general 10-15c/kg QA top up is totally inadequate to cover the cost and bureaucracy involved at farm level. He said this would also boost farmer participation in the scheme, which is flagging.

The Irish sheep meat industry generates an output value of €485 million per annum which supports in excess of 34,000 sheep farmers, and thousands more jobs in related industry services.

Ireland’s national sheep flock totals 2.56 million breeding sheep. Lowland enterprises account for 55% of the ewe population, with the remainder on hill farms. The four major sheep production counties are all along the western seaboard: Donegal, Mayo, Galway and Kerry. These are followed by Wicklow and Roscommon.

During 2018, exports accounted for almost 70% of Irish sheep meat production, reaching a total of 56,000 tonnes, valued at approximately €315 million. The UK and France remain key markets for Irish sheep meat accounting for 58% of volumes in 2018. However, in recent year the sector has been diversifying into markets such as Belgium, Denmark, Germany, Sweden and Switzerland.

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