Article appeared in issue 6, 2022
A sustainable future
Food economist, Ciaran Fitzgerald, stresses that to achieve a truly sustainable future for the dairy sector, both economic and environmental issues need to be respected.
The Irish dairy industry is a key contributor to Ireland’s economy. Unfortunately, Ciaran explains, in the zeal around the very important issue of climate action, agriculture has become one dimensional. “It's only perceived in the context of its environmental impact and the fact that it is a major contributor to the Irish economy is forgotten. But it does not need to be a binary issue. We need to get a better balance and we need to discuss these challenges without cancelling each other out. This is the only way forward.”
Ciaran notes that the growth in the dairy sector has been phenomenal: “Expenditure in the Irish economy from the dairy industry increased from €1.5bn to €5bn since milk quotas were abolished and in the next 10 years the dairy industry will spend at least €50bn in the economy. This is sustainable providing we get the balance right between the working towards reducing the environmental impact and continuing to be competitive in production. We learned from the crash in 2008 that we can't just have one horse in the economic race – we need a number of strong economic platforms. We are lucky at the moment that we have a strong economic platform in foreign direct investment, but we also have a very strong economic platform in the dairy sector.”
Win win…but with cost increases
Ciaran adds that not only does the current commentary often ignore the valuable economic impact that the dairy sector provides but, while focusing on environmental concerns, there is rarely any recognition that there are already verifiable measures being put in place aimed at tackling climate action. “Farmers are working to better improve environmental issues, including water quality and reducing emissions; and a lot of these environmental measures – while clearly pushing up costs – are also creating more efficiencies. I don’t usually like to use the term ‘win win’ but there can be an economic efficiency gain from better environmental measures. The key to this serendipity is that increased production costs because of environmental regulation must be reflected in higher process for sustainably produced food, so there is every incentive for farmers to continue driving sustainable practices. There are clearly things that need to be done in terms of what's happening at production level, there is no doubt about that, but what I would argue is that we cannot do it in such a way that will undermine the sector. Ideological points of view that argue we should be producing more fruit and vegetables and not dairy make no sense from an economic perspective. The return for the producer is not viable.”
Returning to the environmental issues, Ciaran also highlights that Ireland is one of the most sustainable locations to produce dairy, adding that scaling dairy production back will simply shift production to areas that do not perform as well in this regard.
“There is research to show that Ireland is one of the most suitable locations to produce dairy sustainably. We need to be able to have these discussions and get away from this simplistic, binary approach that pits farmers up against those who care for the environment. When we talk about the economic strength of the industry there can be an assumption that we don’t care about the environment. It is about getting the balance right and taking a more holistic and sober approach to the situation – looking at the science, the economics and the environmental concerns – and working together for a better outcome that will deliver improved environmental impacts without reducing the economic one.”