Dairy board welcomes trade deal

This week's world trade agreement will open opportunities to the agriculture and food industries, Irish Dairy Board (IDB) managing director Noel Cawley believes.

Speaking after the launch yesterday of the board's yearly review of world trends in the industry, Mr Cawley pointed out that the World Trade Organisation (WTO) deal to end export subsidies by 2013 was just half the overall agreement.

"That was on exports, we still have to have one on imports," he said. Mr Cawley pointed out that the second half of the deal will tackle tariffs, charges placed by countries on imports to protect home-grown products.

"For instance, the US charges €1,500 a tonne on products like Irish butter, if those charges were reduced, that would be an opening for us."

Mr Cawley added that the Republic's dairy industry was in the best position to deal with the changes it faced as a result of the world trade talks deal. "It's the most efficient industry in Europe without a shadow of a doubt," he said.

Mr Cawley expects that 2005 will be a good year for the board, whose products include Kerrygold butter and a range of milk derivatives.

Yesterday he predicted that turnover would be €30 million to €40 million up on the €1.9 billion recorded in 2004, while profits would be in line with the €38 million surplus it made last year.

He said that it has already distributed €15.5 million as part of its profit-sharing deal with the co-ops. "That has helped to keep the milk price up," he said.

This was the first year that the basis for EU farm supports was separated - or decoupled - from production.

Mr Cawley suggested yesterday that farmers fared reasonably well as a result. He pointed out that while the price paid to them for milk dropped by 4 cent a gallon, the EU price support amounted to 11 cent a gallon.

However, he said that processors have been squeezed by the fact that prices paid to farmers held up reasonably well, while ongoing competition on the supermarket shelves meant they were not able to increase their charges.

Mr Cawley is due to retire in May after 18 years at the IDB helm. Noel Coakley, currently head of the board's UK operations, will succeed him.