Farming a welfare scheme or viable business?

Macha

Here's some stats on food imports:

In 2007, total food imports in ROI were valued at €4.6 billion (£4.2 billion), and in NI total food imports amounted to 0.9 million tonnes, which was equivalent to £460 million (€502 million). The highest foods imported onto the island of Ireland were cereals and fruit and vegetables. A significant amount of food imports, especially fruit, cereals and vegetables are imported from non-EU Countries i.e. China, Costa Rica, and South Africa. Meat and dairy produce, these are mostly imported from within the EU.

http://www.irishpressreleases.ie/2009/07/30/over-half-of-consumers-concerned-about-food-imports/

I would guess that Ireland is a net exporter of food...? It's still worrying that so much of our food comes from abroad - a lot of it unnecessarily. Remember: imports means money straight out of our economy and into others' economies.

Therefore, it's better for our economy if we can produce more of our food here (depending on price difference, of course). It's a similar story with energy: why give €6bn away every year when we can invest in the energy industry here?

Tipp Man

RedPlanet wrote: »

See my previous post about monoculture farming.
Nessie told us that Dairy was the most common type of farming here, then beef i think.
However, it's quite obvious that we don't just eat beef and dairy 3x a day.
Don't most of our spuds come from Spain?

Well there isn't a country in the world that is completly self sufficient in all foodstuffs and imports no food at all, we obviously import items which are suited to different climates. The point is that we have a huge amount of exports in foodstuffs.

turgon

Tipp Man wrote: »

That's just a rubbish analogy, farmers don't set the price of food, supermarkets do, farmers don't set the price they receive, manurfacturers do.

And farmers continue to produce. If the price offered was not enough, farmers would pull out of the business. The the shops wouldn't get their milk, and their profits would go down. If subsidies were removed the price at which farmers could still make a living would go up, so the shops would have to raise their offereing or else deal with a milk shortage.

taconnol wrote: »

You haven't actually addressed the core issue of the volatility of fuel prices. I'm not just talking about high oil prices, I'm talking about volatile oil prices.

Well what are you trying to get at? That the price of food will go up and down irregularly? Whats the deal?

taconnol wrote: »

Hah, sorry that's not how these things work. The important work of biodiversity is also on farmland, not separately in a nice fenced off wildlife reserve.

So supposing we eliminated subsidies and instituted environmental regulations. Would that be ok?

taconnol wrote: »

Yes because as it stands, they have no hope of winning the battle of getting a fair price for their produce.

Yep, so remove the subsidies. As I said in point one.

taconnol wrote: »

Uh, yes. They pursued a narrow-minded, short-sighted economic strategy to the detriment of everything else including society

Hmmm, yes. Raising minimum wage, social welfare, public wages - these were all major policies based on economic sense. Yes.....indeed......

/sarcasm

Tipp Man wrote: »

For starters unless you are a German taxpayer then the amount that farmers receive from YOUR taxes is neglible, again arcade owner is completly irrelevant

So the fact we arent paying it suddenly makes it ok?? Is alright to waste the Germans money.

Tipp Man wrote: »

I have already highlighted to you that there is only so far you can go with economies of scale

Unless I missed something, I dont recall reading a proper explanation for why this is the case.

Tipp Man wrote: »

What do you mean nothing in return?? you get a highly secure, highly nutritious source of some of the best food in the world

You are forcing me to pay for this. Why can I not pay for it directly? Supposing Im allergic to dairy products - why is my tax money being used to pay dairy farmers?

Oh but I forgot, it fine because the Germans are paying for it.

Macha

Also, an interesting story in the Irish Times today from the UK:

UK grocers' ombudsman sought
Britain's competition watchdog urged the government today to establish an ombudsman to rule on disputes between grocery retailers and suppliers after a majority of retailers failed to agree a voluntary arrangement.

Britain's Competition Commission (CC) also published a new and strengthened code of practice for grocers and gave them six months to comply.

After a two-year investigation of the grocery sector, the CC said in April 2008 an ombudsman and beefed-up code of practice were needed following complaints from suppliers of bullying.

http://www.irishtimes.com/newspaper/breaking/2009/0804/breaking21.htm

With over 70% of food in the UK bought in supermarkets, and probably similar figures here, supermarkets know they have the upper hand and are not slow to put producers under immense pressure:

“The supermarket bosses would have consumers believe that reductions are coming from the supermarkets’ own bottom line. They are fooling nobody. The reality is it is off the backs of Irish farmers and farmers’ jobs,” he said.

While he and other speakers stressed Supervalu stores did buy Irish food, the fact remained lamb prices had fallen by 20 per cent last month leaving them with no income and the processors were blaming the supermarkets.

“They talk of price cuts. The fact is you cannot produce two lambs for the price of one and you cannot produce two bullocks for the price of one either,” said Mr Walshe.

http://www.irishtimes.com/newspaper/ireland/2009/0701/1224249837262.html

Tipp Man

turgon wrote: »

You are forcing me to pay for this. Why can I not pay for it directly? Supposing Im allergic to dairy products - why is my tax money being used to pay dairy farmers?

Oh but I forgot, it fine because the Germans are paying for it.

Well i'm allergic to civil and public servants but i still have to pay their bloody wages.

You would think that subsidies from Europe would be welcome in this country given the current economic plight of the country, they should be seen as a major export for this country. Apparently not

Also can you please provide back up as to how Irish farmers are wasting the subsidies they receive seen as though they are using them for survival?? is survival of farmers a waste in your eyes??

Permabear

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Macha

Sorry, didn't see your post there.

turgon wrote: »

Well what are you trying to get at? That the price of food will go up and down irregularly? Whats the deal?

Yes - ask any business or person who runs a tight budget for a home and they will tell you that being able to depend on the price of a certain item, whatever that may be is incredibly important. The immense damage that oil price volatility causes to economies is well known: similar damage can be caused by the volatility in the price of food when extrapolated out on a national scale. And it impacts everyone down the chain: farmers, grocers/supermarkets and households.

turgon wrote: »

So supposing we eliminated subsidies and instituted environmental regulations. Would that be ok?

Aha! That's what I would like to happen . Let's look at the real costs of large-scale food production (including purchase of carbon credits, damage to biodiversity etc) versus the costs of smaller-scale food production.

I think you'll find Tesco's generic brand foods might not be so cheap if they're suddenly not allowed to externalise their costs to the Irish tax payer (if you think about it, this could be considered another type of subsidy..)

turgon wrote: »

Yep, so remove the subsidies. As I said in point one.

And I agree with you

turgon wrote: »

Hmmm, yes. Raising minimum wage, social welfare, public wages - these were all major policies based on economic sense. Yes.....indeed......

Fianna Fail didn't know what they were doing. They're populist so every time a union stamped its feet, they got more money. Because at the time, the government could afford to do so. Unfortunately, the money they were giving them was our national windfall property bonanza that will never be seen again. And now the economy that was so haphazardly thrown together is proving not to have the "strong fundamentals" we threw everything else down the toilet for. Jobs at all costs? Well, that's what we got.

I don't consider any of the above points as part of a social welfare strategy by the government, rather it was a poorly thought out, populist effort to deflect criticism and keep the masses quiet while the builders kept raking in the money.

Tipp Man

donegalfella wrote: »

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Yes it is a serious response, people seem to think that you can turn a cow on and off or grow a bullock overnight to meet demand.
How exactly have farmers brought this on there own heads?? Please tell me. You would think from your response that Irish farmers were dictating milk prices. Fact is Irish dairy farmers have absolutely no say, and i mean absolutely no say in a) how much milk they can produce and b) how much they can sell it for. So please enlighten me as to how they brought it on themselves

itsallaboutheL

Could i ask someone to clarify a few points....

1. You appear to using "famers" as a general term??
Would you not be better off addressing each type separately??


2. Subsidies and Grants...... mean FA to most, could you clarify what these subsidies are and which type of farmer recieves them, and what they recieve them for....

Permabear

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Macha

donegalfella wrote: »

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Um...donegalfella, you do know that CAP was brought about in post-war Europe to ensure sufficient food supplies for the European population?

Permabear

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Tipp Man

itsallaboutheL wrote: »

Could i ask someone to clarify a few points....

1. You appear to using "famers" as a general term??
Would you not be better off addressing each type separately??


2. Subsidies and Grants...... mean FA to most, could you clarify what these subsidies are and which type of farmer recieves them, and what they recieve them for....

Hi

1.Yes the debate is using farmers as a general term, 2 reasons for this, one is that if we were to discuss all types of farming in details the debate would be huge (although maybe not as there isn't enough knowledge here) and secondly a lot of non farming people are on this discussion and don't distinguish between them.

2. your obviously more aware of the subsidies than most !!

Macha

donegalfella wrote: »

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I'm sorry but the objectives are clearly laid out in article 39 of the Treaty of Rome:

to increase productivity, by promoting technical progress and ensuring the optimum use of the factors of production, in particular labour;
to ensure a fair standard of living for the agricultural Community;
to stabilise markets;
to secure availability of supplies;
to provide consumers with food at reasonable prices.

I'm not denying the lobbying power of farmers but to argue that there were no intended benefits to the general European population is something reaching conspiracy theory levels.

Also, you can hardly blame today's farmers for the implementation of a policy framework in 1957.

Tipp Man

donegalfella wrote: »

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Firstly fella you are completly wrong, the milk supply is fixed by the milk quota introduced retrospectivly in 1984

What lobbying exactly was there for protectionism? Lobbying for an equal platform with worldwide farmers perhaps

itsallaboutheL

Tipp Man wrote: »

Hi

1.Yes the debate is using farmers as a general term, 2 reasons for this, one is that if we were to discuss all types of farming in details the debate would be huge (although maybe not as there isn't enough knowledge here) and secondly a lot of non farming people are on this discussion and don't distinguish between them.

I for one would consider this debate to be a waste of time if no distinction is made.

Also any debate on subsidies and grants can't be properly discussed without both sides having all the relevant subject matter.

If government subsidies and grants are to be discussed then it has to be done so while contrasting with government levies and EU directives that impact negatively (or would be seen by farmers as having a restrictive effect) on the industry

.i.e quite a few of these "grants" are for non-essential work which farmers wouldn't necessarily need to do to be viable or efficient.

E.G Reps
Farm Waste Management Scheme ( or anything to do with Nitrates Really)

Tipp Man

donegalfella wrote: »

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itsallaboutheL wrote: »

I for one would consider this debate to be a waste of time if no distinction is made.

Also any debate on subsidies and grants can't be properly discussed without both sides having all the relevant subject matter.

If government subsidies and grants are to be discussed then it has to be done so while contrasting with government levies and EU directives that impact negatively (or would be seen by farmers as having a restrictive effect) on the industry

.i.e quite a few of these "grants" are for non-essential work which farmers wouldn't necessarily need to do to be viable or efficient.

E.G Reps
Farm Waste Management Scheme ( or anything to do with Nitrates Really)

Well your right it is a waste of time, its just annoying when the public are making ill informed assumptions

Your dead right, you can't compare farming in EU with farming in Brazil for example due to the huge burecratic and restrictive nature of EU farming which is an unnecessary burden on EU farmers

Permabear

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nesf

Tipp Man wrote: »

Just on your edit, surely this only applies in an economy with full employment?? Surely if we take half the farmers of Ireland off farms today (say 50k people) then we have 50k more people on the dole as opposed to producing these other things you talk about. your idea is only an ideology and certainly not true for Ireland today

There aren't a fixed number of jobs in an economy, full employment really refers to having a sub 5% unemployment rate. In any economy you tend to end up with around 3-5% unemployment at minimum because a) there are some people who just won't work, even if jobs are available and b) there's always some people who are between jobs and are on the dole for a month or three. If 50K farmers suddenly became unemployed it would take time for the economy to adjust and for them to retrain but over the medium term (say 5 years) one would expect most of them to find work. The problem is that people can't suddenly retrain and start a new profession, that is why it'll take a few years for the unemployment caused by the housing bubble bursting to subside, all those guys trained as electricians and block layers need to retrain and find a new profession. It's not that there aren't jobs there for them per se in normal times (i.e. outside of a recession) it's that they have the wrong skills.

Permabear

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Macha

donegalfella wrote: »

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No - I'm not in favour of CAP! But I am in favour of internalising the currently externalised costs of food that currently favour the large players in the food market.

If you believe in the lobbying power of farmers, surely you can believe in the lobbying power of the likes of Nestle, Unilever, Proctor & Gamble and Kraft to name but a few. I'd be willing to bet it's companies like these that are actually the major benefactors of CAP. Here we go:

Currently 20% of farmers receive 80% of subsidies

http://www.finfacts.ie/irishfinancenews/article_1013642.shtml

Total EU loony bin madness.

Tipp Man

nesf wrote: »

There aren't a fixed number of jobs in an economy, full employment really refers to having a sub 5% unemployment rate. In any economy you tend to end up with around 3-5% unemployment at minimum because a) there are some people who just won't work, even if jobs are available and b) there's always some people who are between jobs and are on the dole for a month or three. If 50K farmers suddenly became unemployed it would take time for the economy to adjust and for them to retrain but over the medium term (say 5 years) one would expect most of them to find work. The problem is that people can't suddenly retrain and start a new profession, that is why it'll take a few years for the unemployment caused by the housing bubble bursting to subside, all those guys trained as electricians and block layers need to retrain and find a new profession. It's not that there aren't jobs there for them per se in normal times (i.e. outside of a recession) it's that they have the wrong skills.

I know all of what your saying but historically has Ireland ever had a 3-5% unemployment rate i.e full employment outside of the recent fictional boom?? Very few if any countries in the world can boast this as their normal unemployment rate. how long do you think it will take for the current unemployment rate to get back down to those levels?/ IMO never unless we get mass emigration again

My point is that your idea is a theoretical and not a practical one IMO

itsallaboutheL

donegalfella wrote: »

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Do you mean if farmers were getting paid less then they would produce more???

Permabear

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RedPlanet

itsallaboutheL wrote: »

Do you mean if farmers were getting paid less then they would produce more???

Maybe he meant, that if they got paid less, would they continue to bother producing, or is there a point where they just call it quits on that product.

I suspect the farmers would keep producing and lobby the government for more and more handouts.

Tipp Man

donegalfella wrote: »

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No as thats about as extreme as it gets, then they would just stop.
However if milk was to make 1 euro a litre then the amount supplied could still not change because of the quota so yes the quantity of milk is fixed upwards.

Look there has always been a resentment in Ireland of anyone who is seen as successful or has something, farmers because they own land, have always faced this, people will always use ridiculous arguements to get their point across as has happened in this thread. I have repeatedly said that most farmers find the CAP and the subsidies a hinderence, however at the moment they are all that is keeping farmers with bread on their tables. The reason that farmers are up in arms at the moment is that coupled with the rubbish prices they are seeing all kinds of cuts in the schemes, for its size agriculture is one of the hardest hit areas of the Bord Snip report

if farming is so bloody good why don't some of you from suburbia up sticks and buy a farm for yourselves, see how much money they are making then

itsallaboutheL

RedPlanet wrote: »

Maybe he meant, that if they got paid less, would they continue to bother producing, or is there a point where they just call it quits on that product.

I suspect the farmers would keep producing and lobby the government for more and more handouts.

#if it dropped by 1 cent tho???

Have you people any idea how much the price of milk fluctuates!!

Also the amount of subsidies Dairy farmers recieve when compared to Beef Farmers is laughable....

EDIT: read original post wrongly, however a 19cent drop in milk price isn't an unusual occurance over the course of a few years

The_Conductor

turgon wrote: »

The milk co-ops can give so little because they know they can get it for so little. If the subsidies were erased tomorrow and the co-ops bought for the same, the farmers would just close shop. So, to prevent their milk supply disappearing, the co-ops would have to give a higher price.

So you'd imagine. Practice states differently. Tesco now have to source almost 30% of its fresh milk sold in England in Eastern Europe....... nuff said.

Macha

donegalfella wrote: »

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Well...I know you're for economic liberalism donegalfella, but wouldn't you also consider the externalisation of many 'costs' of production to the taxpayer another form of subsidy, even though inclusion of these costs involved government regulation and higher food prices?

Just look at the national cost of carbon credits. Organic food production has been proven to be less carbon-intensive than non-organic food production. By taking the cost of credits out of the central pot, organic food purchasers are effectively subsidising the cheaper cost of non-organic food - no?

Tipp Man

smccarrick wrote: »

So you'd imagine. Practice states differently. Tesco now have to source almost 30% of its fresh milk sold in England in Eastern Europe....... nuff said.

We need to get some kinda pipe going across the Irish Sea:)