Irish poultry firm closes, Nando's announce new openings, with chicken from Northern Ireland

News has emerged today that Cootehill Farms, also known as Co-Operative Poultry Products Ltd in Cavan is to close with the loss of 90 jobs. It comes at a time when chicken producers and processors are under incredible pressure to deal with the spiraling cost of animal feed which is making business for some, unsustainable.

The company had been trading in County Cavan, the centre of Irish poultry production since 1949. The 25 farmers who supply chicken to the plant have also now lost their source of income and will need to get contracts with other processors fast, or go under. I've written extensively about the Irish poultry sector on this blog and pointed out many times that unless we eat Irish chicken, we won't have an Irish poultry sector. Cheap imports particularly in food service are killing the Irish trade, also loose chicken on butcher and supermarket counters coming in from Eastern Europe or as far as Thailand, sometimes bed and breakfasting (often with some kind of bulking out processing) in the EU to attain an EU origin stamp.


On the same day we hear of the Cootehill Farms closure, Nandos, the global chicken giant (think Kentucky Fried Chicken with a zestier twist) announces it's opening two new restaurants in Blanchardstown and Liffey Valley shopping centres. These outlets will employ an additional 100 people and bring to seven their number of Irish restaurants. Nandos is a South African success story - originally set up in 1987 it has become a family-friendly dining-out giant, with 850 branches worldwide. And guess where they get their chicken from? Moy Park in Northern Ireland.

Moy Park are also a huge food success story but they are one of the reasons small producers in the Republic cannot compete. Their scale is enormous, they have 13 separate processing facilities in Northern Ireland, England, France and Holland. This year Moypark - owned by the Brazilian food giant Marfrig, posted annual sales of £1.07 billion. You can argue the 32 counties is still Ireland but it's not that simple. We gain none of the revenue in tax from this business nor a cent of the profits which go back to Brazil. Even Irish large-scale poultry businesses such as Vincent Carton's Manor Farm is finding it hard to compete with giants like Marfrig. With feed prices going ever upwards, the retail sector is also bearing the cost. But the view of Irish farmers and operators in the sector is that if consumers are prepared to pay for Irish chicken the present storm can be weathered out and we can still have a viable industry.

I talked to Dublin restaurateur Joe Macken (Crack Bird, Jo Burger, Skinflint) about this recently. He still buys chicken from the Republic for his string of eateries as he feels strongly that if we don't, we'll have no Irish chicken supply left and only ourselves to blame. He is also having to pay a lot more for his Irish chicken as the processors ask their customers to take the brunt of the hikes they're having to pay farmers to keep business sustainable. And what's the root of that? Drought in the US, Ukraine bans on wheat exports and spiraling costs in compound feed ingredients that are completely beyond Ireland's control.

So what's your view folks? Time to put our money where our mouth is or pay for it later?

See also - my extended piece on the issue last year in The Irish Times -

basketcase: Irish chicken, the end of the road?

Sustainability. Sounds green, woolly and warm but what does it really mean for the Irish food sector?

This week in the Irish Farmers Journal I wrote about what sustainability programmes can yield to food producers. Sustainability has been a buzz word bandied around liberally in the past decade. Unfortunately it has also been frequently abused by many food retailers and manufacturers.

More recently the term has gained renewed focus as commodity prices move sharply and continuously upwards. The scramble for land in developing countries to feed our Western appetites has become a contentious issue. Here in Ireland our chief food and drink marketing agency Bord Bia has put a sustainability programme into place. In the following analysis I spoke to farmers, Bord Bia and outside voices on what issues are involved. Of huge importance to farmers is looking at the costs of more form filling against the benefits that may come in the door in terms of farm income.
So what are those benefits? Is sustainability just a word for lovers of open-toed sandals? Or is it a way of farming in Ireland that could yield us huge benefits in the future.


Greening the Shamrock; where’s the pound, shilling and pence?

Irish Farmers Journal Suzanne Campbell, 18th October 2012

Bord Bia’s Origin Green scheme had its “soft launch” earlier this summer; promoting sustainability as something far from green and woolly but as a hard business strategy for Irish food exports. As Ireland’s clean food image is already a seller, what does ticking more boxes on waste and emissions mean for Irish farmers? Is greening the shamrock a strategy that works for big food, or can tracking sustainability create rewards that will filter down to Irish farm incomes?

Sustainability is safety, and Ireland’s track record on extensive production could be worth more than we bargained for in a resource-strapped world under pressure to meet demand for food. With a population of nine billion the global marketplace is a huge opportunity for Irish exports. But it’s also placing pressure on basic but limited resources like water and land.

The new scramble for Africa is about land for growing food, and supplying Western diets from developing countries creates complex issues. Ethiopia which farms baby corn and mange tout for the UK and Ireland has suffered renewed hunger this summer after drought. According to former UN Secretary General Kofi Annan, hedge funds and other speculators bought African farmland the size of France (over 210,000 square miles) in 2009. He attacked the growing practice of “land grabbing” by which countries are buying or leasing land in other nations to increase their own food security.

Food companies cannot afford to be labelled as unethical in terms of where their food is produced and they also need to make sure that the bottom won’t fall out of supply chains. This is where Ireland steps up to the plate; we’ve plenty of rain, good grass and we’ve just began tracking exactly what’s going in and out of the system.

In May of last year Bord Bia began auditing use of water, energy, waste levels, animal feed and production practices on Irish farms. Beginning with farmers in their Beef Quality Assurance Scheme, so far 30,000 members or 94% of QA producers have participating in the sustainability survey; the first national assessment of environmental performance of farms worldwide.

One of the farmers involved in the auditing is Richard Hogge who farms sheep and sucklers in Stonyford County Kilkenny. He views the scheme as worth getting involved in, despite the additional workload. “There’s a fair bit of trust and honesty on the farmer’s part as you’re putting in all your details and costings, so I had to gather all that. Then it’s processed at the Bord Bia end and I get a chart coming back to me outlining how my farm is performing on the different elements.”

For Richard there were obvious rewards in seeing how profitability could be improved. As he has 350 ewes on the farm and 25 sucklers, it was clear from the feedback that his grass could be better utilised by cattle but it didn’t suit his sheep enterprise. “I could have shorter time with cattle indoors but as I need my grass for sheep outdoors all year this is difficult to improve on. At the same time I compared well on how I’m finishing my animals – little outside purchased concentrates, and I’m also getting a calf per cow every year. If I considered a continental bull I might get more kilos per hectare but might lose out on the better calving ratios and fattening from my Angus bull. I’m getting the heifers away at 18 months and the bulls away at 20-22 months off grass. So it’s a balancing act.”

Richard came into the scheme from his involvement in Bord Bia’s quality assurance schemes for his sucklers and sheep. “This was thrown in front of me as an option and for me it wasn’t a hard choice as I’m involved in nearly everything that can be done to improve my lot. For farmers there’s an advantage that it’s showing you what can be improved with what you’re doing, and ultimately that’s saving money ”.

Some of the top farmers taking part in the sustainability programme were rewarded at the Ploughing last week in New Ross by Bord Bia, The Irish Farmers Journal and Teagasc for efficiently producing cattle at a suitable specifications for export. One of these winners was Michael Murphy from Nenagh for his dairy calf to beef production. In a business where profitability can be tricky, Michael found the auditing gave him an outside eye on productivity on his farm.

“When the charts came back, compared to the national average I was up there near the top which made me think I was doing everything as near as good as I can. At first I didn’t know much about carbon footprint and it is difficult for farmers to understand. Sometimes they don’t think about details and may not have any plan in their head about when they’re going to slaughter what they buy.”

For Michael tracking every last figure is the only way his business works. The 200 calves he brings in yearly are fed by machine which communicates with the calf’s electronic tag. He also weighs them every two months.

 “There is a definite time span for any animal I have, you need to keep animals moving along and putting on weight everyday. I can’t understand lads not weighing cattle, I suggested a weighing scales at a discussion meeting and they called it a luxury, for me it’s essential. Overall I found the experience a good one, and if other farmers are thinking about it it will improve their efficiency without doubt.”

Jim O’Toole at Bord Bia was one of the driving forces of the sustainability monitoring, previously working on the Quality Assurance schemes. Quality Assurance has been a huge success for the marketing of Irish food, and customer feedback shows shoppers identify with traceability and “safe food” assurance. But why the move into the more “open-toed sandal” area of sustainability? For O’Toole it was a natural progression from the monitoring they were already doing.

“We did work that was completed in 2009 with some of the bigger customers of Irish food – food service, retailing and manufacturing to see how important sustainability was and we concluded it was an important issue. Our natural production in Ireland would resonate with that perception, but what we felt was that companies wanted more evidence.”

Bord Bia returned to the topic in 2010, asking respondents again about sustainability. Instead of falling in importance as recession dug in, it seemed sustainability had hardened in importance. For customers of Irish food and particularly beef and dairy, sustainability was now on the slate of key words and concepts, but what was driving the impulse for food buyers?

“The debate about sustainability is often described as a triple bottom line – environment, financial and social” says O’Toole. “If there isn’t a financially sustainable supply chain that supply chain could break down. There is also benefit from efficiencies by improving their environmental performance in terms of reducing waste, energy etc so there’s a cost saving there as well as enhancing brand value”

The scale of ambition of Origin Green is huge. To date 27,500 of Irish farms have had a carbon footprint assessment done. 45% of Irish export food and drink production has signed up to the scheme; retailers, food service operators, manufacturers, Unilever, Nestle, McDonalds, Danone and Tesco are already involved. For retailers like Sainsburys with their “20 things for 2020” strategy, auditing our own sustainability on Irish farms can’t fail to be an attraction as it means someone else doing the hard work for them. It’s a move that has put Ireland ahead of the pack, potentially yielding us a competitive advantage.

But farmers might ask - if retailers are so interested in sustainable food chains, why don’t they just pay farmers more? Would Tesco’s investment of £25 million in the Sustainable Consumption Institute at University of Manchester be better spent rewarding extensive farming systems we already have. Sustainability is clearly a great buzz word for retailers and at the corporate table, but where or when is the payback?

“It’s too early to tell” says O’Toole. “The cheap food debate isn’t one that isn’t going to get settled very quickly but from our experience with this programme the buy in we are getting from farmers it means Ireland can secure markets in the future. What we’ve got to do is prepare our industry to compete and win business so it’s a strategic long term initiative.”

Padraig Brennan, senior information analyst with Bord Bia has been working with Teagasc and understands that Origin Green needs to appeal at farm level. “There’s no point in being environmentally sustainable if you can’t make a living out of it. Being sustainable comes down to getting more output from the same input, more beef and more milk on a daily basis – a combination of management, genetics, and using resources on farm.”

As it stands, many food companies aren’t making demands on suppliers in terms of sustainability but as Padraig points out, it’s about Irish producers getting in before the rest of the posse. “We are putting structures in place so rather than waiting for when it happens and being forced into certain things, we’re being proactive in this area and creating that point of differentiation.”

But how important is sustainability to our European customers of Irish food? Marine Digabel, a journalist with Agra Alimentation in Paris came to Ireland this month with a group of European food industry writers, visiting Richard Hogge’s farm and the Glanbia plant in Ballyraggart. “In France there is a real interest in sustainability but  after the French election,  local food and French jobs have become more important.”

With financial woes being felt among France’s retailers and consumers, several things are happening in their grocery market. Apart from poultry, meat consumption is decreasing overall but organic meat is growing its share. Sustainability may have been overtaken by local, but as it makes sense to bottom line, it’s a strategy not being ignored among large French companies like Danone.

“Definitely they are all working towards less energy, less carbon, less waste” says Digabel “probably not because they’re deeply interested in environment but its more about reducing costs all along the chain.” Does getting on the sustainability train early create advantage for Irish producers?  “I don’t know if the Origin Green programme in Ireland will make people switch from one supplier to another. But it might make them more tempted to change. Definitely simply the fact that it’s measured – that companies know they’re working with people who have quality assurance and traceability and tracking the environment, is good for a long term perspective.”

Padraig O’Donnell agrees. Auditing sustainability is about creating solutions for customers of Irish food who may not be ready now, but will need assurances on sustainability in the longer term. “We explain to buyers what the programme is and what it’s trying to achieve. As we get more food and drink manufacturers on board we want to show commitment from a 3-5 year plan and also roll out advice at farm level. We want the companies who are supplying them with product to show the targets they have achieved. A lot of these customers have set out targets to reduce energy, waste targets here and they want their suppliers to help them meet those targets.”

Whatever way the food market moves, Ireland is better off one step ahead than one step behind. We mightn’t have valued it twenty years ago but the homogeneity of our production systems is something other countries have now bypassed, making branding themselves sustainable more difficult. “It’s definitely quite easy for Ireland to set up a programme like this as you have extensive grazing” says Marine Digabel. In northern France it’s similar to Ireland but in some places we have intensive production so there is huge disparity. The same scheme in France would be difficult to implement as you are saying “this type of production is better than another”.

“For me the material payback is in lowering costs” says Richard Hogge. “It’s no good to me unless I can improve profitability, the farm I’m running is a business not a charity. For scheme for me has pointed out where money can be saved without affecting the environment. It’s like bringing the euros and the farm along together.”

Tractorgate 2? What's it all about?

While Dubliners head out for their lunchtime sandwich today they will see thousands of farmers gathering with placards and megaphones on Government buildings. Also expected on the streets are combine harvesters, tractors and cattle trucks; a reminder of the famous "tractorgate" protest on Dublin in 2003 - IFA's drive to draw attention to difficulties on Irish family farms. Throughout the country today, many dairy co-ops, beef, lamb, pig and poultry processors, grain merchants and marts are also expected to close for business in support of the farmer's action.
Want to know why? Here's a quick guide -

The protest has been organised by the IFA (Irish Farmers Association) who feel that reform of the Common Agricultural Policy (CAP) will threaten productivity and jobs in the farming and food sector. They feel that farm output will drop and our targets for increased production as laid out in the Government planned "Harvest 2020" programme will be undermined. Currently CAP is being negotiated for its next round and is set for changes in how subsidies are paid to farmers and for what type of farming activities. Payments will be separated from numbers of livestock (headage based) to a more acreage based system, which will benefit some farmers but penalise others. Some observers say it's fairer and more environmentally friendly and has been called the "greening of CAP". Others say it will hamper growth and ultimately make Irish farm incomes smaller.

IFA president John Bryan (right) has accused the agricultural minister Simon Coveney of misleading farmers in the scale of the CAP proposals. He says they will flatten basic payment by 2019 and result in some farmers experiencing income cuts of 50%. The problem is that in negotiating CAP reform, ag ministers throughout Europe have to deal with very varying types of farming, environmental and sustainability issues and look at what consumers can pay as a fair price for food. In recent decades Europe has promoted a cheap food policy whereby farmers are subsidised to produce as consumers couldn't pay the actual price demanded for a kilo of beef for example. If you reduce this subsidy, or move this subsidy more towards an environmental emphasis, the result is that us consumers may have to pay more for food.

Subsidies in many cases are what are keeping many small farms in Ireland in operation. We also have to ask, do we want to keep a family farm model and if we do, what is Europe prepared to pay for this? Or do we want to reward the "leanest" and biggest producers. CAP has a spectrum of roles and needs, for ministers it's a challenge in finding the right balance across the EU and upsetting farm organisations in your own country is part of that process. Everyone wants the best they can get for their region, but from a limited EU budget that's not going to be possible.


The protests today are also designed to send a warning shot across Irish government bows in advance of the budget. The IFA are calling for restraint on further taxing farm families, particularly in an environment where feed costs, fuel costs and inputs are on the rapid rise and those in the white meat sector - pig and poultry producers are seriously under pressure. Already these producers and processors have asked for retail price rises in order to cover their costs. We're in a tricky environment for farming at the moment, but there are those who would say it's never "not tricky" - food and commodity prices are always and possibly increasingly volatile in a global marketplace where hedge funds are also active in influencing price outside of its intrinsic value. Is this just another storm to weather or should Government and the EU be building in more mechanisms of stability in farming and food production? Controls on betting on food prices (have been tabled) and codes of practice to regulate the retail price of food?

lronically today, we will also see an announcement from Kerry Group around the corner from the protests in the Shelbourne hotel on the creation of 900 new jobs at its plant in Naas. The announcement will be attended by the Taoiseach, Taniste and Minister Coveney. Whatever you may think about the timing, this is a fantastic news for employment and shows a thriving dairy export sector. Farming is an activity where you can have one sector thriving and another in ribbons. Perhaps in CAP reform the focus could be more on evening out that volatility and making the yellow brick road a little less twisty.

GM or not to GM. That's the question, bet I know the answer

There's a rift appearing in the Irish agri-food sector which could affect what has for so long now been a good news story. Last week Teagasc announced that they've applied for a license to sow genetically modified potatoes at their research centre in Carlow.

Irish groups opposing GM claim this threatens our export food market in a climate when agriculture is one of the top performing sectors of the economy. Surveys do suggest that consumers don't want to eat GM food, and that the perception of Ireland as a "clean, green nation" is key to the success of our exports in countries like Italy and Germany.

It also comes at a time where in the US, farmers who choose not to grow GM are currently taking a class action against Monsanto - they fear that when Monsanto's GM seeds contaminate their own crops, Monsanto will claim ownership and charge them licence fees on what were originally sown as non GM foods.

But Teagasc and agri-food experts like Dr. Paddy Wall say the fear of GM is nonsense and it's the only way to tackle world hunger, and a mistake for Ireland to not embrace it. They also feel not allowing GM animal feed into Ireland has made our pig and poultry sectors completely uncompetitive. There argument is - if consumers want Irish food at a fair price, eventually we will have to accept genetically modified crops as part of that picture and that arguing against it will damage Ireland in the long term.

Let's also remember that the Teagasc research is not to look at the economic viability of blight-resistant GM potatoes here, but to look at their environmental impact in the first instance. I'm doing a radio report on this next week and encourage all who have a vested interest or from a consumer point of view, a preference to GM or non GM food, to get in touch. Let your views be known!