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 Header Item Sugar Industry (Continued)
 Header Item Coillte Teoranta Lands

Thursday, 13 December 2012

Dáil Éireann Debate
Vol. 786 No. 3

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(Speaker Continuing)

[Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry] It is absolutely unbelievable. Why do we not have an industry? We do not have an industry because a Fianna Fáil Minister in a Government of which Deputy Ó Cuív was a member shut it down and absolutely ruined our countryside.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews I must ask the Deputy-----

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry I understand that but it is insulting to those of us who tried to maintain the industry. I could spend ten minutes talking about why we do not have a sugar industry and I am upset that Deputy Ó Cuív is not here to respond to me.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews This is out of order, Deputy. I ask Deputy Barry to resume his seat.

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry I will resume my seat but it is an absolute disgrace that Deputy Ó Cuív tabled this question and his colleagues know that.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews Deputy Barry, you cannot-----

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry It is insulting for those of us who have suffered. I am not going to allow this sort of behaviour. The Deputy tabled a question but he knew damn well-----

Deputy Seamus Kirk: Information on Seamus Kirk Zoom on Seamus Kirk Deputy Barry is totally out of order.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews The conduct of the Chamber is my responsibility.

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry I understand that.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews I ask the Deputy to resume his seat. The Ceann Comhairle has listed the questions for oral answer and I am obliged to deal with the questions and invite the answers.

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry I understand that but the Deputies on the other side know that their party was responsible for closing down the sugar industry. It is a disgrace-----

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews That is a discussion for outside this House.

Deputy Tom Barry: Information on Tom Barry Zoom on Tom Barry The Fianna Fáil Deputies brought it inside the House.

Acting Chairman (Deputy Peter Mathews): Information on Peter Mathews Zoom on Peter Mathews Deputy, please. I call on the Minister.

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney I can understand my colleague's frustration, as somebody who comes from a town where the sugar industry provided huge employment and significant opportunities for arable farmers in particular, that the industry is now no longer in existence because of policy decisions and mistakes that were made a number of years ago. That being said, I think it is possible for us to revive the sugar industry, but only if a number of things happen.

First of all, I have made it clear that the Government is not going to subsidise the setting up of a new sugar industry because we need to ensure that any new industry that begins in Ireland again can stand on its own two feet. However, I believe there is a fighting chance that the sugar industry will be set up again in Ireland on a commercial basis. Last summer we had two very professionally put together viability studies for the setting up of a sugar industry in Ireland again, from a processing point of view, which would involve building a large sugar processing plant and ethanol production facility. There are a number of people who are extremely committed to making this happen and they are very credible people. Michael Hoey, in particular, who heads up Beet Ireland, has put a huge amount of his own resources and time into putting together a very realistic business plan for rebuilding a sugar processing sector in Ireland. It is his job to put the business case together and he will do that, in terms of attracting investors and so forth. It is my job to ensure that if that business case is to proceed that there is either a sugar quota for Ireland in the future or there is no sugar quota in the European Union.

The current sugar regime in the EU will end in 2015 and Ireland has already been compensated to get out of that regime to the tune of €353 million. That means that we are not going to be able to produce sugar before 2015. The Commission is proposing that the sugar quota regime would end in 2015, which is something that Ireland supports. However, I do not think it is realistic because the countries that currently have sugar quota will insist on the quota regime extending beyond 2015, in my view, possibly until 2018 or 2020. In that context, we will be seeking an opportunity for Ireland to be allocated quota for domestic use, given the fact that we have been compensated to be out of the sugar industry until 2015 but not beyond that. Given the size of our food industry here and the volume of sugar use in that industry, we should be allowed a sugar quota to be able to support it. We have made a very strong case for this, both publicly and privately, to the Commission.

Deputy Seamus Kirk: Information on Seamus Kirk Zoom on Seamus Kirk If there is potential to rebuild and regenerate the sugar industry in Ireland then clearly steps should be taken to do so. As the Minister has said, at least one feasibility study has been carried out-----

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney Two studies have been carried out.

Deputy Seamus Kirk: Information on Seamus Kirk Zoom on Seamus Kirk Have those feasibility studies been made available to the Minister?

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney Yes.

Deputy Seamus Kirk: Information on Seamus Kirk Zoom on Seamus Kirk Have the studies been assessed by those who are dealing with the possibility of regenerating the sugar industry and if so, what does the assessment indicate? Is there a potential for the industry, provided certain things happen and if they do not happen, what is the position? What is our competitive position vis-à-vis other sugar producing countries across the EU?

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney The feasibility studies were very professionally done. Both of them were presented to me and both of them involved detailed meetings around the presentation of those feasibility studies. We then asked officials in the economics section of my Department to assess the feasibility of the business plans. It is important to say, though, that in order for those business plans to be viable, the price of processed sugar must remain at a level that can pay for all of this because we are talking about a €200 million investment to build the plant before any sugar beet can be processed to produce either ethanol or sugar. It is probably fair to say, as a rule of thumb, that these feasibility studies stack up if the price of sugar remains at over €500 per tonne. It is well over that level at the moment and actually, in the last 12 months, it was close to €800 per tonne because there were real shortages of sugar in the European Union. A lot of food industries in Ireland, some from my own part of the country, were finding it hard to get sugar at any price, which suggests that there is an argument around sugar security for both the pharmaceutical and food industries. Having said that, a judgment has to be made by the investors and those putting the business plan together as to what the likely sugar price will be in three, five or ten years time and what the price will be if sugar quotas are abolished in the European Union.

  When we were producing sugar in Ireland we were not particularly competitive vis-à-vis other parts of Europe in terms of the tonnage of beet per hectare we were growing and the sugar content. However, I believe we can be much more competitive now and the proof of that can be seen in the United Kingdom at the moment. The varieties of sugar beet being grown there are highly competitive with other parts of Europe and there is no reason Ireland could not benefit from that. We can be competitive in this area but whether this happens will be contingent on where world sugar prices go. In my view, they are not likely to collapse any time soon. Sugar is in strong demand because consumption will continue to grow, both in the European Union and, more important, further afield.

Coillte Teoranta Lands

 8. Deputy Charlie McConalogue Information on Charlie McConalogue Zoom on Charlie McConalogue asked the Minister for Agriculture, Food and the Marine Information on Simon Coveney Zoom on Simon Coveney the position regarding the proposed sale of the Coillte forest crop; and if he will make a statement on the matter. [55980/12]

Deputy Simon Coveney: Information on Simon Coveney Zoom on Simon Coveney The Deputy's question concerns the current position with regard to Coillte. Deputies will know that the Government made a decision in principle to move ahead with preparing for and investigating the possibility of a sale of Coillte forests. Essentially this involves selling the harvesting rights to commercial Coillte forests and the investigative and preparatory process is under way. Work is ongoing between Coillte, NewEra - which is managing this process - and my Department. Consultants have also been brought in to do specific work around valuations and managing how the sales process may proceed, with the aim of maximising the value to the State, if value is to be found, as well as taking account of the other sectors that may be impacted by such a sale, such as the sawmill sector and timber supply generally, which is totally dominated by Coillte at the moment. This is a very complex process which we are in the middle of at the moment but I assure Deputies that the Government will act with caution. We will not do anything that will undermine or significantly damage the timber or sawmill sectors in Ireland. Effectively, we have a monopoly in Coillte at the moment. Most sawmills take more than 80% of their timber from Coillte forests. If we proceed with this, we will do so with caution to try to protect other sectors that will be affected by any sale, while at the same time trying to maximise value for the State.

Deputy Seamus Kirk: Information on Seamus Kirk Zoom on Seamus Kirk Are we to deduce from what the Minister has said that no decision has been taken yet as to what will happen with Coillte?


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