Horticulture Council Report March 2023

Market Report 

The recent commentary in media regarding some crop shortages on the continent has shone a light on the broken food chain for fresh produce producers. The current shortages of many horticulture food crops are a direct result of soaring input costs and of the imbalance of power in the food supply chain. There is still huge concern around the outlook and the cost of input materials and energy costs. The price of gas is still four times higher compared to the average of the previous decade. The Horticultural Exceptional Payment Scheme (HEPS) did alleviate some pressure for certain horticultural sectors last year and this support must be put in place again this year. 

The increased costs of growing all horticulture crops, compounded by the price pressure from food buyers, means that there is no room to account for events such as weather or input cost spikes. High energy prices have meant that growers cannot afford to heat glass in our sector for early crops.  

The imbalance of power in favour of the main retailers has driven margins for growers so tight that it’s inevitable the current shortages will become more common in the future. The progress of the Food Chain Bill through the Oireachtas is welcome, but on its own, it will not be enough to safeguard the supply of fresh fruit and vegetables. It’s clear from the current shortages of vegetables from Spain and Holland that retailers cannot rely on imported produce. Retails and packers need to engage closely with growers or many growers will simply not be in a position to continue supplying produce.   

Temporary Business Energy Support Scheme (TBESS) 

Under the Cost of Living Package announced last month the Temporary Business Energy Support Scheme will be extended, to 31 May 2023, and enhanced, including by reducing the threshold for qualification from a 50% increase in electricity or gas costs to 30% increase (to apply retrospectively from 1 September last year), and by increasing from 1 March the level of relief from 40% to 50% of eligible costs, subject to a monthly limit, which will also be increased from March, to €15,000 per month per trade or profession, subject to an overall cap of €45,000 where the business is carried on from more than one location. These changes are subject to state aid approval from the European Commission. The cost of the extended scheme will be met from the allocation provided in Budget 2023. 

Work Permits 

The introduction of the proposed seasonal work permit scheme still remains extremely important and will be very important for the sector moving forward and IFA continues to lobby to get this over the line. IFA appreciates any assistance that can be given, such as providing sufficient evidence of the lack of available labour in the country.  

Activity since last National Council  

• Horticulture Grant Scheme – it was announced that the Horticulture budget will increase to    €10 million. The scheme is yet to open – the Scheme falls under State Aid in accordance with EU Guidelines for State Aid in the Agricultural and Forestry Sector and in Rural Areas. As the previous Guidelines expired on 31/12/2022, this has resulted in a delay to the opening of the 2023 Horticulture Grant Scheme as it had to be notified under the new EU Guidelines for State Aid. 

• IFA issued a press release on the shortage of fruit and vegetables on the continent and the difficulties Irish producers face at present https://www.ifa.ie/farm-sectors/fruit-vegetable-shortages-the-result-of-a-broken-food-chain/ . Committee members partook in a number of media interviews on the topic also. 
• The IHNSA ran a successful trolley fair in conjunction with Bord Bia on Whites Agri premises Lusk Co. Dublin on February 21^st. The trolley fair was very well attended by industry and trade customers.  
• An Organic Project Team meeting took place on February 21^st in the Farm Centre. Bord Bia’s new Organic marketing manager was guest speaker and discussed their plans for 2023. 
• Two members of the IFA Organic Project Team attended the Biofach Organic Trade fair in Germany last month. A number of meetings were held at the event including a meeting with Minister Pippa Hackett.  
• IFA continues to meet with all retailers on an ongoing basis to highlight the reduced margins that all growers are experiencing due to spiralling input costs. 

• IFA continues to liaise with the Department of Enterprise, Trade and Employment on processing work permits and the establishment of a seasonal work permit scheme.  
• Activities under the Green Cities Promotions continue as part of the European funded initiative. The campaign aims to promote green landscaping in building projects in Ireland, while encouraging the use of locally-grown planting stock. The promotion is 80% funded from the E.U. with 20% coming from the industry. Growers are reminded to contribute to the promotion. 
• A Green Cities online seminar took place last month as part of the EU Green Cities Initiative to discuss plans for 2023.  
• IFA completed a submission on the Control of Wild Birds Deceleration and the impact lack of control would have on agricultural subsectors including potatoes and horticulture.  
• An amalgamated Field Vegetable and Protected Crop and Soft Fruit committee meeting took place on January 12^th in the Farm Centre. Input costs, difficulties for the upcoming season and work permits were on the agenda.  

• IFA completed a detailed submission on the Sustainable Use of Pesticide Regulation which will replace the existing Sustainable Use Directive (SUD).  

EU/COPA Developments  

• IFA has continued contact with both the EU Commission and COPA in relation to the impact of spiralling input costs on the Horticulture sector.  

• An online Copa Fruit and Vegetable meeting will take place on March 1^st. IFA will attend the meeting. 

Upcoming Events / Issues 

• IFA will continue its lobbying campaign in relation to the harvesting of peat for the horticultural sector.  
• IFA will be lobbying to include the sectors of horticulture affected by Brexit in the Brexit Adjustment Reserve (BAR) fund announced by the EU. 

• IFA will meet the Ulster Farmers Union on Horticulture, Tillage and Potatoes on March 1^st in Dundalk.  
• The EU promotional campaign for Fruit and Veg is now underway. More information can be seen here https://fruitnveg.ie/. The promotion is 80% funded from the EU with the remaining contribution from growers.