The announcement by Greencore that it is to close its sugar factory in Mallow is a hammer blow to the local economy. A total of 320 jobs will be lost directly and a great amount of indirect employment will be put at risk.
It marks the end of an industry but it may also mark the end of employment for workers who have given decades of service to the company and are of an age or a skill-set which meets resistance in the jobs market.
The decision itself will not have come as a surprise to the workers but the timing was not widely expected; there was hope that a final crop would be grown and processed. The sugar industry, established 80 years ago in Carlow, is going the way of other traditional Irish industries such as clothing and footwear, which also have succumbed to global competition.
Irish sugar production was protected from the winds of competition by the payment of EU agriculture subsidies; for years Ireland received the greatest per capita benefit thanks mainly to the subsidies. A scenario where agriculture soaked up more than 40 per cent of the EU budget but only accounted for 5 per cent of EU jobs and 2 per cent of EU output was always difficult to justify. It was, however, the World Trade Organisation which did it for the sugar industry by declaring sugar subsidies illegal because they resulted in surpluses being dumped on world markets. Only the biggest and most efficient EU sugar factories can live with the new regime; closures have already taken place in Denmark and Latvia while others are planned in Italy and Spain.
The fate of 3,700 sugar beet growers, who now have no buyer for their produce, is uppermost in the minds of the Irish Farmers' Association. But many of them may already have begun to examine other options. Greencore would have kept Mallow open for one more harvest if enough farmers indicated they would grow a final crop. There was, the company says, insufficient indication of such an intent. Minister for Agriculture Mary Coughlan put up a good fight last year to retain subsidies but then, when she realised the game was up, concentrated rightly on getting the best compensation package and did well. Now she will have to preside over the mother of all squabbles on who gets the lion's share of the money.
Greencore, which will incur considerable costs with redundancy payments and redundant plant, says that it is entitled to 90 per cent of the package while the remainder should be divided out between the farmers and the contractors. The company bases its opinion on legal advice. Ms Coughlan, it can be assumed, will secure her own legal advice. The IFA accuses Greencore of "bringing about the demise of the industry". That charge is simply not sustainable. But Greencore, an enormous group with 9,000 employees spread over six countries, might explain why it was unable to plan for any alternative industry in either Mallow or Carlow which might offer employment to workers who gave the company their loyalty over decades, and now face a bleak future.