Committee for
Agriculture and Rural Development

Friday 22 September 2000

MINUTES OF EVIDENCE

Debt - The Particular Circumstances
Faced By The Pig And Beef Industries

Members present:
Rev Dr Ian Paisley (Chairman)
Mr Savage (Deputy Chairman)
Mr Bradley
Mr Douglas
Mr Dallat
Mr Ford
Mr Kane
Mr McHugh
Mr Paisley Jnr

Witnesses: Mr R Foster ) National Beef Association
Mr H Marquess)

The Chairman:

This meeting is now in session. At 10.40am we will go into private session - as you have requested - to deal with the cartel question. We will have approximately 20 minutes for that. I will announce when we are beginning the private session, as the Galleries will have to be cleared. I hope that that suits you. Welcome, we are glad to have you.

We now propose to hear your statement, and then I have some questions to put to you from the Chair. My colleagues will then be asking questions.

Mr Foster:

This is an exciting time as we set out to put more form and structure into the Northern Ireland agriculture industry, and I appreciate being able to take part in this. I am aware that our submission may be seen as negative, so I would like to assure you that the National Beef Association (NBA) is not a negative organisation. We really do try to examine things with an open and imaginative mind, but we do not want to get caught up in something without it being properly examined, and we feel that it will at times be necessary for us to record our reservations and basically "say it as we feel it".

We feel that something must be done. The present climate between the producer and the processor is nearly corrosive. There are suspicions on both sides; there is a lack of trust; and, at the same time, there are very poor prices for prime cattle inside Northern Ireland compared with other areas of the UK.

We accept that the formation of a co-operative is a legitimate subject for examination. I want to make that clear. But, we also believe in evolution, not imposition. Our summary of the present situation in Northern Ireland is that the ground on which the seed of this co-operative is to be sown is pretty stony.

There is evidence of co-operative failure in Northern Ireland in the past. I have colleagues who are far more familiar with the detail of this than I am. Moy Meats is one example, and there was also a pig venture that did not work out as well as people had hoped.

If a co-operative is to be effective it is more likely to happen through evolution. If facility was made for a number of small, tightly managed, not very costly groups to be established, each with a specific processor, each could work with that processor to market something that could be sold at a premium outside the commodity circle that is so necessary for Northern Ireland beef.

A good example of this, in the sheep sector, is Strangford Down. It began as a group basically run by a secretary and an unpaid committee, and has been effective because of the people within it. It is now beginning to absorb others that have not performed as well and is therefore growing organically - the phrase used in business circles for this. When you look at co-operation on a world level in the industry you will find that the Danish Pig Co-operative is put forward as the model. It is the most effective and it grew and was not imposed. It began small, became big, and is now the model.

We suggest that that approach is probably the best, but it requires a lot of discussion. For those looking for an immediate solution to the obvious problems that exist in the Northern Ireland beef industry, that might not be quickly achieved through a series of small co-operatives rather than the imposition of a national co-operative as you would like.

We have outlined our basic reservations. We are very keen to take on the questions that we feel we are sure to face, but we are not being negative. We just feel that the current climate within the Northern Ireland beef industry does not lend itself easily to the imposition of a co-operative. If one is forced on the industry then some people may later regret it.

The Chairman:

Your submission has been full and frank and that is what we want. We want to hear the objections and try to analyse and see how we can make progress. It is not the intention of this committee to try to force anything on the farming community, because that would immediately destroy it - it would be self-destructive to do so.

The beef and pig meat industries, among the livestock sectors in Northern Ireland, are characterised by a producer base that is badly fragmented and disconnected with the markets it serves. The milk sector, on the other hand, has strong producer groups that are well aligned in their markets and are currently receiving better market returns than any of their GB equivalents.

In your submission you spoke about a co-operative being the answer, but you do not agree that fragmentation among producers results in weak price negotiations. Therefore, we would like to hear you on three simple points. How strongly do you support the creation of a better-organised producer base for beef? What steps do you believe must be taken to bring this about, particularly if a co-operative is not your preferred solution? What resources is the NBA prepared to devote to this end?.

Mr Foster:

We support it very strongly. We are very conscious of the fact that in the United Kingdom beef price league, Northern Ireland lags well behind. It produces the same type of beef, similarly bred. It is biologically indistinguishable from the product presented in other areas of the United Kingdom, yet its price is between 10% and 12% lower than the United Kingdom average.

The Chairman:

What steps do you believe must be taken to bring about a better-organised producer base for beef? In particular, if the co-operative is not your preferred solution, what would you put in its place?

Mr Foster:

I think, Dr Paisley, that the principle behind the co-operative is that a product be properly presented through it in an organised way. If a co-operative is working, it is more likely to be targeting the beef outside the commodity sector and putting it across a wider range of markets. This means that it can have a chance of securing the premium price and therefore of raising the income of the producer. The latter would be likely to happen if the beef export market were opened. There can be no doubt about that. We are looking forward to Northern Ireland's achieving low incidence status some time before June next year. As a result of that, more Northern Ireland beef will be presented to a wider range of consumers and, I hope, at higher prices.

The Chairman:

Mr Foster, what resources would the NBA be prepared to devote to this end?

Mr Foster:

We have not got many resources, Dr Paisley, but we would put them all behind it.

The Chairman:

These are points that I want to get on the record, because we have to look at them with our advisers. The creation of a well organised and market responsive producer group will undoubtedly require very significant leadership. Which of the many organisations involved should take that leadership? Is this something that the NBA ought properly to do? Would the NBA be minded to take the lead role in this matter?

Mr Foster:

I have to be frank. The NBA does not have the resources to be able to undertake that. A co-operative is a giant project. I have said that we would prefer it to start from small beginnings, but if the mood right across the beef industry in Northern Ireland was to go for a co-operative - and we have discussed this - we would stand behind it.

The Chairman:

If you had the financial resources, would you be prepared to take a lead role?

Mr Foster:

Yes.

The Chairman:

We hope the Government will be forthcoming with finances. If that were the case, would you be prepared to take a lead role?

Mr Foster:

We would.

The Chairman:

You have expressed caution about a co-operative whose members would invest only if their money was not to be wasted. If a strong producer group could be created, what would be a reasonable contribution to ask from the Government and the farmers?

Mr Foster:

It would not be possible to launch a successful co-operative in Northern Ireland until we are absolutely sure that competition for cattle is as clean and as open as we would like. There would be little point in putting any resources into a project that was designed to raise cattle prices if there were a system in place preventing the full market force - the proper collision between supply and demand - being demonstrated in the prices that farmers obtain. Although the cattle are similarly bred and sold in the same market, the prices over here are habitually 10% to 12% lower than the Great Britain average. That is far more than the cost of transporting them across to the mainland.

The Chairman:

You are saying that a fair playing field would be a prerequisite. There should be absolute cleanness and openness, and everyone would be sure of that.

Mr Foster:

Absolutely.

The Chairman:

You will have an opportunity when we get to that stage. Disturbing evidence has been put before us. I have two more questions. The quality of the composition of an average beef herd in Northern Ireland appears to have been deteriorating in recent years. Nevertheless, we are being told that the best of Northern Ireland beef is good enough to command a premium price in discerning markets such as Holland. You have given an excellent appraisal of what has gone wrong. Do you agree that improving the quality of the total beef herd to be of highest quality is an urgent industry objective? If you do, can you tell us what the NBA proposes should be done about this urgent matter? Who also needs to make a contribution to this goal?

Mr Foster:

We have just taken part with Northern Ireland organisations in an event called "Suckler 2000" at which this very problem was addressed. The contributions of the Livestock and Meat Commission and the Department of Agriculture and Rural Development were very evident on that day. I would have said that we already had a great deal of co-ordination of thought and of resource within the industry, and that this had already been demonstrated at "Suckler 2000".

We may be confused about the difference between the quality of an animal and the quality of beef. The quality of the animal is what we concentrated on in our submission. We have to get past the influence of the Holstein and introduce more breeding to raise the shape of the animal, which means that after it is slaughtered, the carcass would yield more beef.

If we are talking about beef quality, Northern Ireland and the rest of the UK are in a very good position to sell quality beef at premium prices on an export market. We are alone in the EU in producing beef from grass. The rest of the EU produces beef from grain. A great deal of the beef produced in Europe comes from dairy herds and Holstein bulls - pure dairy bulls.

The British Isles, which of course includes Northern Ireland, have a natural niche product, capable of being sold at a premium price on world markets. In particular, the European Union would be a huge target market. We would have to produce a lot of good beef from an animal, and that requires an element of its breeding to be derived from British genes. These have a natural Hereford Shorthorn and Angus Shorthorn breeding. Both these have a natural ability to carry intramuscular fat - known as "marbling" - which adds to the taste, flavour and juiciness in a unique way. Therefore, we need to pay attention to both the weight of beef that we can take off a carcass, and the type of beef within that carcass. Attention ought to be paid to proper structures in which suckler cows possess at least half these British genes.

The Chairman:

Finally, your paper suggests that Department of Agriculture and Rural Development should encourage farmers to produce specialist beef heifer and suckler replacements. Could this be done now? What could the Department do to make this happen? And finally, how long would it be before the effect was felt on the herds?

Mr Foster:

It would take three years from today to produce a bulling heifer.

The Chairman:

It could start now?

Mr Foster:

Yes, if two animals were mated today and they had the proper breeding, there would be a bulling heifer available to a suckler calf breeder in three years' time.

Mr Bradley:

Your paper supports the prospect of a Northern Ireland brand label for beef, yet it also suggests that a variety of specialist brands should be pursued. Which is your preference and why?

Mr Foster:

We consider the establishment of the Greenfields brand to have been a huge success. Its failure because of the export ban would be a massive disappointment. The possibility to resurrect this from Northern Ireland sources would be welcomed. However, we consider the importance of this brand to be that it establishes regular income for the people producing these animals, people who qualify for that brand. A brand allows the beef that is sold beneath it to be offered at a premium, thereby offering the possibility, if it is properly managed, to raise farm income as well as the price of the animals.

It is important that as much beef as possible be sold outside commodity circles in the sense of discount-led supermarket circles. At present, Northern Ireland beef is trapped. It can only be offered at a discount in supermarkets that are selling beef on the mainland. Should a variety of brands be created inside Northern Ireland, we would not consider that to undermine a national brand such as Greenfields. But if this wider range were offered, there would be a greater chance for Northern Irish beef to be sold outside commodity circles at a premium rather than a discount.

Mr Bradley:

Who should be exploring this branded concept? Also, would several brands not each incur high start-up costs?

Mr Foster:

They would. There have been some spectacular brand failures because of inability to sell a consistent product. People expect repeatability from branded products. Branding requires discipline. The Greenfields brand was successful because all that had to happen was that beef was red and the cattle were grass-fed. Those were the essential qualifications. If you are selling a brand in an area that is already familiar with that product, then you will have to be more specific.

Mr Savage:

Would there not be high start-up costs? Would we not be better with one single brand?

Mr Foster:

That might well be the case, but why fight with one hand? Why not fight with two? If you have a range of secondary brands then that would offer the opportunity for a number of farmers to form an alliance with an individual processor.

Mr McHugh:

I welcome you, the work you are doing, and the possibilities you can create in order to improve the industry. I agree with some of what you have been saying in the press over the weekend about systems working against improving the beef industry at farm level. Do you feel that the beef industry should be investing in creating strong brands and in selling its products only to outlets such as Albert Heijn in Holland, who are prepared to work in partnership to promote and strengthen the brand in markets they serve? Can there be sufficient trust between producers and processors to make this work in premium markets?

Mr Foster:

It is essential that there be trust between producer and processor. That is why I mentioned stony ground. I used the word corrosive. The current relationship between the two, in Northern Ireland, is disappointing. It is corrosive and does not lend itself to fresh green shoots, which is what we are looking for.

The Chairman:

Should the beef industry not be investing in creating these strong brands?

Mr Foster:

Yes, it should.

Mr Paisley Jnr

I wish to put three points to you about branding, which is a very important part of your submission. The bulk of Northern Ireland beef produce is sold in British supermarkets as their own brand. What can prevent a very powerful customer such as the supermarkets changing its supply line?

Mr Foster:

Nothing.

Mr Paisley Jnr:

Following on from that, my other point is that you say that customers would be willing to pay a premium for what they are currently getting if they are reassured about the quality of the Northern Ireland product. Is it not true that as far as most consumers are concerned, price is God? Indeed, is it not the case that price and taste are God? Is it realistic to ask consumers to pay more just because a product is branded? How would you reassure the customer that the Northern Ireland brand is a better brand for which they should pay more?

Finally, on page seven of your submission, you say it is better to try and establish a single Northern Ireland label or a variety of labels. I assume you are saying that if we continue to go down this road of branding and marketing, we should really be taking on a variety of Northern Ireland labels.

Mr Foster:

I think so. You would be selling in a variety of markets. That does not take away from what I said. I think you can do the two things together. There is nothing to stop the discount-led multiple selling a commodity moving on to a product from Argentina, Australia or America. If you sell your own label, which is the way the majority of beef in Northern Ireland is going, then you will be extremely vulnerable.

What you have got is a product that is a genuine niche product in EU terms. It could be offered in a wide variety of markets within the EU, as a niche rather than a commodity product. There will always be a commodity sector led by price, but you could put a high proportion of Northern Ireland beef onto the niche market and generate premiums in that way. It comes from grass-fed steers and heifers, not from cereal-fed dairy bulls, which are the predominant source of beef within the EU.

Mr Ford:

There is evidence that the price the beef processors pay to the farmers does not reflect the differential value of the better carcasses. How serious do you think that problem is and what effect is it having on the industry?

Mr Foster:

That is a technical question about classification and carcass yield. There is strong evidence that the price schedules currently presented by the processors, in general, result in high yield carcasses being cheaper than they ought to be, and low yield carcasses more expensive. It suggests that something is being overlooked, rather than being a deliberate policy.

Mr Ford:

If the prices accurately reflected quality, what effect would it have on the industry? I refer in particular to some of the things you said earlier. If you have greater numbers of the Angus and Hereford crosses available, does that mean that you will end up filling the niche markets, and this creates a situation where the beef and the dairy herd would be almost valueless?

Mr Foster:

No. There are a wide variety of markets for all types of animals. I must stress that beef is not bought on quality by the processor at present, it is bought on carcass yield. The cattle that yield the most beef are the most economically attractive because they reduce the unit costs of the beef processors. The Angus and Hereford are animals that, in the view of anyone interested in the beef industry, increase the value of beef by making it more palatable and attractive. However, they would not hit the top classification grades, because they have a lighter back end or rump. There is nothing you can do about that. Payment on carcass yield, through the classification process, would not encourage the inclusion of those animals in the breeding system.

There are one or two cases of specialist breed-led projects, in which animals that qualify under the Aberdeen Angus certified scheme or Hereford certified scheme can get a significant premium on the basis of the quality of their beef, rather than the yield. If there was a classification system that reflected meat yield more accurately than is currently the case, more farmers would be encouraged to breed animals that yield better quality meat than they do now, and the Holstein influence would be minimised.

Mr Dallat:

Your paper states that the National Beef Association is not convinced that a co-operative is the best or most effective solution. How else would you address this issue?

Mr Foster:

Greenfields, which was a success, was not a co-operative-based idea. It was led by people within the industry who saw it as a means of increasing their profit. Similarly, profit-led projects could result in a wide variety of brands being undertaken. It would not be impossible for a number of processors to form an alliance, on an individual basis, with a number of producers and produce their own brand to be sold in the markets that they have chosen. That is an alternative to a co-operative.

Mr Dallat:

Would it be worth pursuing different models of co-operatives, so that an alternative would exist, giving farmers across Northern Ireland an equal chance at getting the best price for their money? It is well known which co-operatives failed and why. However, there were ones that have been highly successful as a result of their particular model and structure. Would it be worth pursuing further the type of co-operative that may be appropriate rather than simply dismissing the generic term, claiming that it does not work?

Mr Foster:

If a formula for success were identified, we would be very interested in it.

Mr Bradley:

The paper refers to how producers would be more responsive if they owned the processing plant. Is this a possibility? Where would the finance be found, and how could such a facility compete with other world-leading companies?

Mr Foster:

There is a flaw here. We were of the opinion that having a co-operative in possession of a plant would be advantageous to us. It was not considered beneficial to sell to others who may not be doing as well as they ought to, particularly to ensure that the industry would get as much income as it ought to. There would be money pitfalls here. Furthermore, it is not a path that we would stand behind forcefully.

Mr Douglas:

Your paper mentions the historical position of the co-op member as one who could step outside the co-operative to obtain a short-term price advantage. Would this be an insurmountable problem?

Mr Foster:

This was discussed at a full meeting with the National Beef Association of Northern Ireland earlier, and the general impression was that the Northern Ireland beef farmer would not be confident about other beef farmers remaining loyal to his co-operative.

Mr Kane:

With further reference to question five. The NBA is not convinced that a co-operative is the most effective solution. Does the NBA believe that a co-operative is flawed from the outset? It concerns me how it requires the voluntary co-operation and participation of processors who have no vested interested in the promotion of producers' roles.

Mr Foster:

If a magic wand could be waved and suddenly Northern Ireland had a working co-operative, then it would be essential for the meat industry to greatly change their attitude, as well as the processing sector. If you are pragmatic, even cynical, you would not expect leopards to change their spots overnight.

If you set up your own processing facility, it would remain necessary to recruit people from within that industry and maintain that culture. Without a complete change of attitude, you would be vulnerable to the bad elements in that culture existing in your own organisation.

Mr Kane:

Your correspondence suggests some sort of contract between our traditional production methods and the consistency of product produced. Would consistency be achieved if good practices were maintained?

Mr Foster:

The greatest consistency is to produce beef from grass. That is if you are selling into a niche market across the rest of the European Union, where such a product is not readily available. That would be achieving consistency. If you were selling into Britain, where there is already red meat from grass, it would be more difficult to achieve a consistent product.

Consistency tends to depend on absolutely similar feeding methods being used across a large number of animals. That would only be possible if a small number of people were involved who were larger than usual businesses. There is a contradiction between establishing that, which is a good idea, and maintaining as many people as possible on the land within Northern Ireland, where the average settler herd is less than 20.

The Chairman:

The Department of Agriculture and Rural Development is currently involved in many aspects of the beef industry. How effective is this effort in driving the competitive position of the industry forward? What changes, if any, would you like to see in the nature and focus of the Department's inputs to the industry?

Mr Foster:

Dr Paisley, I am a relatively recent visitor to Northern Ireland, and I do not think that I can answer that beyond saying that I have been impressed with the relationship that your Department of Agriculture has with its producers. There are three producers on my right who I think could answer that better.

The Chairman:

It will have to be brief.

Mr Marquess:

There needs to be an improvement in the female section of the cattle so that they may have the ground for the rearing of these better calves. Nothing has been done by the Department to improve the female side. Its attitude is that a first class bull will rear a first class calf, which is wrong. They have the wrong concept and I think they need an improvement there, they need to do something. There is no subsidy on a heifer. Well, these past few months there has been, for example, when you slaughter them you get a premium. There is a subsidy on bull calves, and there is really no incentive to carry on your heifer and to rear a really good heifer. If you had some sort of incentive for a man to produce a good heifer, I think it could be done.

Mr Foster:

Dr Paisley, I did not answer a question that you raised earlier. There is a new EU lure that persuades farmers to carry cattle of a hill type, which would be of a British type, on higher ground. I think it is possible to establish a stratified production system of crossbreeding, in which several calf breeders are presented with a ready-made bulling heifer that had been bred on higher ground in Northern Ireland. I think that is possible.

The Chairman:

Thank you very much. This session is now closed.

I wish to put three points to you about branding, which is a very important part of your submission. The bulk of Northern Ireland beef produce is sold in British supermarkets as their own brand. What can prevent a very powerful customer such as the supermarkets changing its supply line?

Mr Foster:

Nothing.

Mr Paisley Jnr:

Following on from that, my other point is that you say that customers would be willing to pay a premium for what they are currently getting if they are reassured about the quality of the Northern Ireland product. Is it not true that as far as most consumers are concerned, price is God? Indeed, is it not the case that price and taste are God? Is it realistic to ask consumers to pay more just because a product is branded? How would you reassure the customer that the Northern Ireland brand is a better brand for which they should pay more?

Finally, on page seven of your submission, you say it is better to try and establish a single Northern Ireland label or a variety of labels. I assume you are saying that if we continue to go down this road of branding and marketing, we should really be taking on a variety of Northern Ireland labels.

Mr Foster:

I think so. You would be selling in a variety of markets. That does not take away from what I said. I think you can do the two things together. There is nothing to stop the discount-led multiple selling a commodity moving on to a product from Argentina, Australia or America. If you sell your own label, which is the way the majority of beef in Northern Ireland is going, then you will be extremely vulnerable.

What you have got is a product that is a genuine niche product in EU terms. It could be offered in a wide variety of markets within the EU, as a niche rather than a commodity product. There will always be a commodity sector led by price, but you could put a high proportion of Northern Ireland beef onto the niche market and generate premiums in that way. It comes from grass-fed steers and heifers, not from cereal-fed dairy bulls, which are the predominant source of beef within the EU.

Mr Ford:

There is evidence that the price the beef processors pay to the farmers does not reflect the differential value of the better carcasses. How serious do you think that problem is and what effect is it having on the industry?

Mr Foster:

That is a technical question about classification and carcass yield. There is strong evidence that the price schedules currently presented by the processors, in general, result in high yield carcasses being cheaper than they ought to be, and low yield carcasses more expensive. It suggests that something is being overlooked, rather than being a deliberate policy.

Mr Ford:

If the prices accurately reflected quality, what effect would it have on the industry? I refer in particular to some of the things you said earlier. If you have greater numbers of the Angus and Hereford crosses available, does that mean that you will end up filling the niche markets, and this creates a situation where the beef and the dairy herd would be almost valueless?

Mr Foster:

No. There are a wide variety of markets for all types of animals. I must stress that beef is not bought on quality by the processor at present, it is bought on carcass yield. The cattle that yield the most beef are the most economically attractive because they reduce the unit costs of the beef processors. The Angus and Hereford are animals that, in the view of anyone interested in the beef industry, increase the value of beef by making it more palatable and attractive. However, they would not hit the top classification grades, because they have a lighter back end or rump. There is nothing you can do about that. Payment on carcass yield, through the classification process, would not encourage the inclusion of those animals in the breeding system.

There are one or two cases of specialist breed-led projects, in which animals that qualify under the Aberdeen Angus certified scheme or Hereford certified scheme can get a significant premium on the basis of the quality of their beef, rather than the yield. If there was a classification system that reflected meat yield more accurately than is currently the case, more farmers would be encouraged to breed animals that yield better quality meat than they do now, and the Holstein influence would be minimised.

Mr Dallat:

Your paper states that the National Beef Association is not convinced that a co-operative is the best or most effective solution. How else would you address this issue?

Mr Foster:

Greenfields, which was a success, was not a co-operative-based idea. It was led by people within the industry who saw it as a means of increasing their profit. Similarly, profit-led projects could result in a wide variety of brands being undertaken. It would not be impossible for a number of processors to form an alliance, on an individual basis, with a number of producers and produce their own brand to be sold in the markets that they have chosen. That is an alternative to a co-operative.

Mr Dallat:

Would it be worth pursuing different models of co-operatives, so that an alternative would exist, giving farmers across Northern Ireland an equal chance at getting the best price for their money? It is well known which co-operatives failed and why. However, there were ones that have been highly successful as a result of their particular model and structure. Would it be worth pursuing further the type of co-operative that may be appropriate rather than simply dismissing the generic term, claiming that it does not work?

Mr Foster:

If a formula for success were identified, we would be very interested in it.

Mr Bradley:

The paper refers to how producers would be more responsive if they owned the processing plant. Is this a possibility? Where would the finance be found, and how could such a facility compete with other world-leading companies?

Mr Foster:

There is a flaw here. We were of the opinion that having a co-operative in possession of a plant would be advantageous to us. It was not considered beneficial to sell to others who may not be doing as well as they ought to, particularly to ensure that the industry would get as much income as it ought to. There would be money pitfalls here. Furthermore, it is not a path that we would stand behind forcefully.

Mr Douglas:

Your paper mentions the historical position of the co-op member as one who could step outside the co-operative to obtain a short-term price advantage. Would this be an insurmountable problem?

Mr Foster:

This was discussed at a full meeting with the National Beef Association of Northern Ireland earlier, and the general impression was that the Northern Ireland beef farmer would not be confident about other beef farmers remaining loyal to his co-operative.

Mr Kane:

With further reference to question five. The NBA is not convinced that a co-operative is the most effective solution. Does the NBA believe that a co-operative is flawed from the outset? It concerns me how it requires the voluntary co-operation and participation of processors who have no vested interested in the promotion of producers' roles.

Mr Foster:

If a magic wand could be waved and suddenly Northern Ireland had a working co-operative, then it would be essential for the meat industry to greatly change their attitude, as well as the processing sector. If you are pragmatic, even cynical, you would not expect leopards to change their spots overnight.

If you set up your own processing facility, it would remain necessary to recruit people from within that industry and maintain that culture. Without a complete change of attitude, you would be vulnerable to the bad elements in that culture existing in your own organisation.

Mr Kane:

Your correspondence suggests some sort of contract between our traditional production methods and the consistency of product produced. Would consistency be achieved if good practices were maintained?

Mr Foster:

The greatest consistency is to produce beef from grass. That is if you are selling into a niche market across the rest of the European Union, where such a product is not readily available. That would be achieving consistency. If you were selling into Britain, where there is already red meat from grass, it would be more difficult to achieve a consistent product.

Consistency tends to depend on absolutely similar feeding methods being used across a large number of animals. That would only be possible if a small number of people were involved who were larger than usual businesses. There is a contradiction between establishing that, which is a good idea, and maintaining as many people as possible on the land within Northern Ireland, where the average settler herd is less than 20.

The Chairman:

The Department of Agriculture and Rural Development is currently involved in many aspects of the beef industry. How effective is this effort in driving the competitive position of the industry forward? What changes, if any, would you like to see in the nature and focus of the Department's inputs to the industry?

Mr Foster:

Dr Paisley, I am a relatively recent visitor to Northern Ireland, and I do not think that I can answer that beyond saying that I have been impressed with the relationship that your Department of Agriculture has with its producers. There are three producers on my right who I think could answer that better.

The Chairman:

It will have to be brief.

Mr Marquess:

There needs to be an improvement in the female section of the cattle so that they may have the ground for the rearing of these better calves. Nothing has been done by the Department to improve the female side. Its attitude is that a first class bull will rear a first class calf, which is wrong. They have the wrong concept and I think they need an improvement there, they need to do something. There is no subsidy on a heifer. Well, these past few months there has been, for example, when you slaughter them you get a premium. There is a subsidy on bull calves, and there is really no incentive to carry on your heifer and to rear a really good heifer. If you had some sort of incentive for a man to produce a good heifer, I think it could be done.

Mr Foster:

Dr Paisley, I did not answer a question that you raised earlier. There is a new EU lure that persuades farmers to carry cattle of a hill type, which would be of a British type, on higher ground. I think it is possible to establish a stratified production system of crossbreeding, in which several calf breeders are presented with a ready-made bulling heifer that had been bred on higher ground in Northern Ireland. I think that is possible.

The Chairman:

Thank you very much. This session is now closed.

8 September 2000 (part iii) / Menu / 22 September 2000 (part ii)