While at the National Ploughing Championships last year, in truth I felt like a bit of a fraud mooching among the Massey Fergusons. My suburban Dun Laoghaire is about as far from an upbringing in the Irish countryside as you are likely to have on this island.
Yet, when you look a little closer, most of my Dublin teenage friends had at least one grandparent from the land.
Although not so much the case for this generation of teenagers, my generation of Dubs has extraordinarily strong links to farming.
As the Jackeen cousin of a big Cork family, I get reminded of this any time I venture south beyond Newlands Cross. The Ploughing is Irish agriculture. Agriculture is crucial to the economy and the fabric of Irish rural society and it is still the biggest indigenous industry in the country.
Despite the problems with beef prices last year and milk prices this year, Irish farming has the capacity to grow rapidly. There is real value in land, food and farming. The global demand for food is constant and growing.
After all, if the world population is exploding to seven billion, someone has to feed these people. For example, who will provide milk powder to Chinese infants?
It could be Ireland – one of the world’s natural milk producers. Tiny New Zealand has already achieved the remarkable feat of becoming China’s biggest dairy supplier. Why couldn’t we follow suit?
But to get there, the complexion of Irish farming has to change dramatically.
The most successful farmers in the world are Dutch. The old quip that if the Dutch lived in Ireland they’d feed the world and if the Irish lived in the Netherlands we’d drown, is half-true.
The Netherlands does feed lots of the world. It generated a phenomenal €79 billion in agricultural exports in 2013, second only to the US.
That’s over three times the level of Ireland, in a country that has a constant battle with the North Sea and has one of the highest population densities in Europe.
Three times the value with a land mass just a bit bigger than Munster. Now that’s efficient farming, and Holland has one of the highest environmental standards in the world in terms of pollutants used in farming.
So it is possible to dramatically increase capacity to meet new food demand. And we know that the demand for the type of food we produce is rocketing. And the change in the Asian diet is not limited to dairy.
It is a little appreciated fact that when less-well-off people get richer, the first thing they change is not their iPads, their smartphones or their cars as you might expect – people on the move upwards change their diet. When they have a few more shillings, people shift to eating more meat.
We are already seeing this in India and China, where the new middle classes have dropped their traditional diets and are adopting western red meat to indicate their higher, more westernised, social status.
This diet shift comes with its own environmental issues because such a changed diet demands massive increases in inputs, fertilisers, water and so on. But let’s park these concerns for the moment and think about the future for Irish agriculture in the context of these global changes.
There is an enormous global opportunity for efficient Irish farming in a world of growing populations and changing diets. And the figures in Ireland for agriculture bear this out.
Agriculture is still Ireland’s biggest indigenous sector, contributing €24 billion to the Irish economy, almost 10 per cent of all exports and 7.7 per cent of all employment. (According to Teagasc, this figure rises to 10 per cent when all agricultural subsections are included.)
And crucially in a world where industries are footloose and move freely, an industry like agriculture is fixed. It can’t move. (Many industries in Ireland are simply input/output industries, whereby lots of imports come in and they are redirected out to the world from Ireland with very little local value added bar the wages.)
Farming is different because most of the materials are local: the workers, the land, the crops, the fertiliser and the animals. As a result, according to a recent UCD study, every €1 investment into Irish agriculture leads to a €4 return in the economy.
We can see this by the gap between farming output, which is just above €4 billion, and agricultural and food output, which is €24 billion.
This implies a massive €20 billion in value is added from farm to export market. This is huge and would get bigger if farmers adopted the Dutch approach to agriculture.
This economic ratio, which measures how much €1 circulates in the local economy, is called the multiplier. It explains how each euro spent can be amplified.
For example, I buy from you, you employ my friend and pay his wages, he buys something with his wages from me and I employ someone else who, with new wages, buys from you. In economics, your spending is my income and my spending is your income. The more local the trading, the more this applies, and this is what the Ploughing is all about.
Agriculture and food is local. Raw materials are local. Employment is local and sales are local. More than 70 per cent of farming raw materials are locally sourced, as opposed to just 44 per cent for domestic manufacturing companies and much less for multinationals.
But here’s the rub: in order to change to a Dutch model, the essence of Irish country life would have to change quickly.
There could be no place for small holdings. Huge tracts of land, which are now in effect hoarded, would have to be sold and ultimately the very landscape of Ireland would change irreparably.
Is that too high a price? I don’t know. What do you think?
What you are saying is more larger Industrial and efficient farms. would that not mean less people employed.. Large Corporate Farms will care little for ‘local manpower and welfare’…
I came here via
“Everyone should pay their fair share”
Nobody likes paying taxes. We hate income taxes such as the USC. We loathe consumption taxes like Vat. We truly hate even the idea of a wealth tax….
but am reading about farming.
Isn’t the Netherlands model more like a big factory? Artificial lights and heaters. They might produce tons in smaller spaces but I’m sure this could be replicated anywhere not just Ireland.
Isn’t the Irish ‘clean green natural’ image what we’re selling abroad?
Yep, larger more efficient farms, no little farms, no part time farmers who have a job and use their small inherited (very tax efficiently) plots inefficiently as a part time venture.
But that would lead to all sorts of lost votes, so even though it is the correct and efficient thing to do it will never come to pass as people anachronistically cling to the trappings of a foregone century.
David, interesting article, However the last paragraph concerning the inefficiency of smallholdings is dangerously inaccurate and misunderstanding this leads to another theme you are currently writing about which is wealth concentration. Please read and understand the following discovery cited from an article by George Monbiot “It was first made in 1962 by the Nobel economist Amartya Sen(2), and has since been confirmed by dozens of further studies. There is an inverse relationship between the size of farms and the amount of crops they produce per hectare. The smaller they are, the greater the yield.” This is fully detailed in this… Read more »
David comparing Irish agriculture to Dutch agriculture is like comparing apples to bowling bowls. In Holland they use 10 times more pesticides/ hectare than we do. That’s just pesticides, not fertiliser or sewage sludge. There is room for improvement here. The land commission basically made a proper b*llsup when large estates were divided up in the early 20thC. We are still suffering the consequences of this today, the biggest problem being fragmentation. Farms here are inefficient because farmland is scattered in 3,4 or more parcels. Compare that to polders in Holland, each farmer got a square single block of land… Read more »
The Multiplier. At present 300,000 variable rate mortgage customers have to divert 4,000 euro each from the domestic economy. This failed bankers charge is placed on top of the real variable rate by Irish 2015 bankers( same 2007 bankers)in order to make Irish Banks stronger. Forced firesales(forcing up front losses) instead of restructures have a multiplier effect for the domestic economy also. Poor political and central bank leadership has little regard for the human & economic cost. A 30bn (0 %)for 25 years from ESM fund would have provided industry best practice restructures for domestic grossly overvalued debt so that… Read more »
A really ignorant article. How will farmers farm when the land has been bought by hedge funds pricing farmers out of the market as the only way to preserve wealth in the monetary madness consuming the planet? Have you not read what Tony Brogan has been telling you all along re small holdings? I have wanted to farm for a long time now but cant because I wasn’t left a farm.. Con acre (rented land) is too expensive to generate an ROI on
Hi David, Whilst I agree with some of the points in your article (e.g. agriculture has significant export potential for the Irish economy and has a major contribution to make to our society generally), there are other points where I would have a different view. One of the major advantages that Irish agricultural products have on the world market is the “clean and green” image which is based on family farms selling top-quality products using practices that are relatively better than the standard from an environmental perspective (e.g. grass-based dairying as opposed to intensive dairying). If this is given up… Read more »
David A very interesting article. A few comments the Dutch had a fully developed agriculture industry before the advent of milk quota’s. The advent of these set Irish Agriculture back 20 years as we were working off a small base. We have no indigenous markets unlike the Dutch who not only have a large population base 17 million as opposed to 4 million in Ireland but they also have access all around them to markets in France, Germany, Belgium etc. Every thing we export has to go through one if not two ferry journeys. You then have the land base… Read more »
Crotty needs another outing. As a young, self-taught farmer he employed more than a dozen people on his farm and engaged in labour-intensive, high-output farming using all the latest techniques. His next door neighbour did nothing but graze cattle and did nothing but let them run wild. Every so often he’d call in a buyer and let him go down into his fields and see what he could lassoo. In contrast Crotty was exhausted after his day’s labour. He also realized that he wasn’t getting a penny more in profits out of the farm. The reason was the cost of… Read more »
Here’s a bit of Crotty I have on my computer. From Raymond Crotty, A Radical’s Response: “The Irish establishment, more durable than the walls of Jericho, did not crumble when Irish Agricultural Production was published. Indeed, apart from the odd, mainly favourable notice in obscure journals, Ireland and the world proceeded after the book’s publication precisely as they had done before. Academic argument, however cogent, impinges little, if at all, on the course of events. “The broad outline and general thrust of the book had occurred to me while still farming full blast in Dunbell, Kilkenny. The essence of my… Read more »
This guy Will Allen a 6 foot 7 inch African American is showing they way forward for farms of the future;
Off topic but……………….
Rent controls in Dublin Dathi. And look what happens when rent controls go in; The exact opposite of what you want.
We now Dathi have a centrally planned and controlled economy. Peter Sutherland must be on one week long orgasm. You know David the best way to reduce demand in a centrally planned economy?
Shoot everyone. Better still starve them to death sure food prices and rent costs can be reduced simultaneously at the one go and sure with all the educated people dead you can tighten your grip on power like pol pot.
David have a look at this video then tell me how many €3 chickens it would take to pay for the kit?
Dutch Agriculture holdings are smaller in size than Ireland.
Ireland average size 32.3 hectares.
The Netherlands average size 29.5 hectares.
Sources : [ both official, and based on official state statistics ].
The central premise of that article is not even factual.
Not even remotely factual.
A theory based on bullsh!t.
mick.dfarmer Nothing like a farmer to tell it like it is. I don’t believe there’s a farmer in the Country who has two brain cells to rub together who would buy into David’s bigger is better argument. I think David is playing devils’s advocate again. I’ll stand corrected on this (probably by Adam Byrne) but I don’t think specialising in cash crops like sugar cane or bananas turned the Caribbean Islands into paradise for most of the Islanders. It certainly made a fortune for companies Tate & Lyle and Del Monte while plantation workers lived and worked in appalling conditions.… Read more »
I was wondering why there was an increasing demand for dairy products in China, seeing as they are lactose malabsorbent. I had assumed they were forcing themselves to eat it, out of fashion as it were. It never occurred to me it was for baby formula milk, which is the obvious reason when you think about it.
I think agriculture is basic to every economy in that (as I understand it), looked at historically, industrial sense followed on from successful agriculture.
I do think, however, that David should try to be a bit more consistent.
What? Did I just say something?
Seriously, I hope David hasn’t been getting too much flack from his mates over the comments here about immigration, some of which have been, let us say, candid. I appreciate the fact that this site has welcomed free speech over the years and can’t think of another to match it.
Ireland as a food producer is likely to do well in the portending greatest depression as people have to eat. Those with their own 5 acre in production will survive while the world collapses around them. People have to eat.
These graphs show the real economy not somebodies supposition
Hi David, Your little blow out has caused me to contemplate what might be ailing you. At a superficial level I’d say that over the last few articles almost everyone has disagreed with you especially suggestions like putting Syrians in vacant Irish houses and this one about bigger farms being a good idea etc. But at a deeper level I’d say you were really and truly shocked that Yellen didn’t raise interest rates as you said the Fed was about to declare victory when I’d say the exact opposite is about to happen but time will tell. So I think… Read more »
It’s unarguable that improving productivity of agriculture, without losing the hallmark quality, would be beneficial, and that Holland is evidence that it can be done. Generally my criticism of this argument, and David’s made it before, is that there are no first world agricultural economies. But given the fact that the multiplier for agriculture is 4, and for the overall economy I think it’s something like 1.5, it does cast an interesting light on things. Perhaps, given 20 years of the so-called ‘financialisation’ of the economy, there might be opportunities. More focus on improving the agricultural output, given the same… Read more »
Db4545 and Tony
I an short gold on my spreadbetting platform but long a cef in gold and oil which sells options for income with roughly 50/50 weighting. I also buy coins.
Gold will be sold until the meltdown at which point it may skyrocket but if it does it will be confiscated. The Db4544 observation on the 70/1 bet is valid.
Tony & Michael It’s hard to see the downside of a 70/1 result on VW options in those circumstances Michael. I certainly wasn’t being dismissive Tony I’ve stated repeatedly I’m here to learn. You clearly have a deep knowledge of precious metals and you show a strong desire help people avoid disaster in the event of financial meltdown. I live a fairly modest lifestyle so I’ve no interest in a so called fast buck just safe investments with potential for growth while avoiding the sharks. This site gives a really diverse range of perspectives and it would be a shame… Read more »
Hi there, sorry for the blowout. I’m only human too! Now lets get on with the job at hand:)
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