Fears grow for 200 jobs at Cappoquin Chickens

Protesters at a rally outside the Cappoquin Chickens plant in Co Waterford yesterday. IFA president Padraig Walshe criticised supermarket chains for using discounted imported chicken as an enticement to shoppers.
Photograph: Provision

SUPERMARKETS AND other commercial purchasers of poultry were yesterday urged to buy Irish produce by the IFA as fears grew for 200 jobs at Cappoquin Chickens in Co Waterford, after a receiver was appointed to the company.

IFA president Padraig Walshe told a rally attended by some 100 poultry producers and their families outside the plant that the threat to the €200 million Irish chicken industry from cheap foreign imports had never been greater.

Mr Walsh criticised supermarket chains for using discounted imported chicken as an enticement to shoppers, especially when he claimed such imports do not satisfy the same high food standards as Irish chicken. "This has devalued a quality assured product in the minds of customers. Offers such as 'two for one' put downward pressure on producer margins at a time of rising costs. Supermarkets cannot continue to use food as a loss leader in their pursuit of market share," he said.

Chairman of the IFA poultry committee and local supplier to Cappoquin Chickens, Ned Morrissey said imports of questionable traceability from countries such as Brazil and Thailand were damaging the industry in Ireland.

"These imports do not meet stringent welfare and environmental regulations that Irish producers adhere to. Consumers should be made aware of the huge gulf in standards between fully traceable quality assured Irish chicken and what is imported."

Mr Morrissey said some 50 chicken producers in west Waterford and east Cork who are owed €1 million by Cappoquin Chickens are hoping that receiver Aidan O'Connell would find an investor to secure the future of the plant. "Producers are owed on average €30,000 to €40,000 by the company. It has been a very difficult time for the industry with a drop in market demand because of the bird flu scare, cheap imports and rising prices," Mr Morrissey said.

He expressed disappointment that workers at the Cappoquin plant had not joined yesterday's rally.

However, Siptu branch secretary Davy Lane said workers had reached an agreement with the receiver to work as normal while he tries to save the plant.

Earlier this summer, the High Court heard that Michael D O'Connor Sons and Company, which trades as Cappoquin Chickens, showed a deficit of €806,000 on an ongoing basis and had a winding up basic deficit totalling €7 million.

Yesterday John O'Connor, whose grandfather founded the business in the 1930s, told The Irish Times that Cappoquin Chickens had, like the rest of the Irish poultry industry, suffered as a result of the bird flu scare and rising prices for chicken feed, as well as from cheaper foreign imports. Costs have risen with the price of chicken feed going from €240 to €245 a tonne, to €360 a tonne and for a company like Cappoquin chickens, which uses 850 tonnes of feed a week, it means the company is carrying an extra cost of €120,000 a week, he said.

Mr O'Connor said the company is facing a serious situation and the closure of the plant would be a major blow to the west Waterford economy as it contributes €6 million to €7 million annually in wages and a further €1.5 million in payments to chicken producers.

The Irish Times understands that executives from a British company, Derby Poultry, which previously expressed an interest in investing in Cappoquin Chickens, are due to visit Ireland later this week for further discussions about a possible takeover of the plant.

However, industry sources said a deal would have to be secured within the next two to three weeks because of the breeding cycle of chickens, and if a deal is not agreed within that time, it will be very difficult to restart production at the plant, which kills 250,000 birds a week.

This article appears in the print edition of the Irish Times