The Minister for Agriculture, Food and Rural Development, Mr. Joe Walsh TD, referred
to the outcome of the negotiations on adjustments to the beef regime in the Agriculture
Council in Luxembourg today.

Mr. Walsh said that going into these discussions his main objectives were:

  • to secure an increase in the intervention ceiling to cope with the Autumn
    beef surplus and
  • to achieve an orderly transition from the end of the Purchase for Destruction

The Minister said that he had secured these objectives in the course of the
negotiations. The Council decisions would place the beef sector in a much stronger
position to deal with the ongoing surplus arising from the sharp fall in consumption
as a result of the BSE crisis at the end of last year. In particular, he had
secured an increase of 150,000 tonnes in the intervention ceiling for 2001 and,
even more importantly, he had secured a commitment from the Commission that
the intervention system will be used to stabilise the market in the Autumn.
This would remove a significant uncertainty in relation to market supports for
the coming months.

Mr. Walsh said that, while his over-riding priority is to secure the re-opening
of third country markets, the intervention concession will help to ensure a
smooth transition from the Purchase for Destruction Scheme to intervention after
1 July. The Minister pointed out that the Destruction Scheme will have removed
275,000 animals from the market by 30 June at a cost of approximately £200
million to the Irish taxpayer.

On the other elements of the package, the Minister said that he had succeeded
in restricting the proposals on the Special Beef Premium quota and the Suckler
Cow quota to the two years 2002 and 2003 and the removal of the proposal on
individualisation of the Special Beef Premium quota; in addition, the minimum
heifer requirement in the Suckler Cow premium had been reduced from 20% to 15%,
which was close to the normal suckler cow replacement rate. Minister Walsh said
that he had also secured an exemption from this requirement for producers with
less than 14 suckler cows and this would exclude two thirds of Irish producers.
Furthermore, the reduction in the stocking density limit from 2.0 to 1.8 lu/ha
would be phased in over two years.

Commenting on the reduction in the Special Beef Premium quota for Ireland,
Minister Walsh said that he was satisfied that the new quota, which was 3% higher
than payments made in recent years, would be adequate for our requirements.
In this regard he pointed out that applications for the Special Beef Premium
this year were 15 % lower than in 2000 and male calf registrations were also

In relation to the overall package, Minister Walsh said that any loss in premium
income to Irish farmers, which he estimated at worst at £2 million p.a.,
would be substantially outweighed by the higher level of intervention support
which he had negotiated as part of the package. In the absence of these arrangements,
there was a real prospect that cattle prices in Ireland would collapse in the
Autumn. The Minister also pointed out that it was in the long term interests
of Irish producers – more than any other group of producers – that the EU market
was restored to balance as soon as possible and that agreement was reached at
this particular Council.