Commercial Mushroom Producers (CMP) Co-operative Society Limited is the largest Producer Organisation in Ireland representing in the region of 90% of Irish mushroom growers. During the last 12 months, a number of smaller Producer Organisations have ceased operating and their members have joined with CMP making it the primary PO representing mushroom growers in Ireland. We have over 120 members located in Ireland, Northern Ireland, the UK and Holland. In 2005 we purchased in excess of Euro135m worth of mushrooms of which approximately Euro120m was exported.
CMP offer a range of cost saving services to members. These include packaging supplies group insurance rates, group pest control, assistance with on farm investment, subsidised picker training and access to specialist advisers.
Packaging design change The new CMP packaging- designed to sell Leading multiples in the UK are changing the punnet type supplied to their stores. CMP has had the foresight to invest in the manufacturing process for making these punnets. In effect CMP will be the agent for this type of packaging. This is a strategic investment by CMP to secure benefits and savings for the industry. This new punnet type is now the preferred packaging type for Tesco.
Dismal Failure by Marketing Agents
During the last 9 months, CMP has also pushed forward on marketing. For several years now, growers have watched in dismay as prices returned to them via the main marketing agents in Ireland have fallen year on year. This has resulted in an exodus of mushroom growers from the industry over the last 2 years due to unsustainable returns. The total number of active growers in the Republic of Ireland today is in the order of 130, significantly less than the high of 585 in the mid '90s. In fact this week, two more have confirmed their intentions to cease growing. CMP is now endeavouring to market members' produce directly to the Multiple Retail trade in the UK.
Soft Option Marketing agents acting on behalf of CMP members continue to reduce prices to growers as the soft option when difficulties arise in the market place. They have failed to represent the reality for growers striving to make a living in mushroom production and since January of this year have come looking for further price reductions (on no less than two occasions in the case of one marketing agent). Other agents have resorted to price reduction in a less transparent manner via their grading systems whereby grade achieved determines price paid. This is unacceptable and CMP has requested that these Marketing Agents allow us to negotiate on behalf of members on pricing issues in the future.
I believe the UK Retail trade want to see a vibrant and sustainable mushroom industry in Ireland and that retailers do not fully understand just how vulnerable this industry is right now. I further believe that the fault lies firmly with the failure of our marketing agents to represent growers and who resort to short term expediency to secure orders and volume at any price. This is not sustainable.
Market research A marketing consultant was retained by CMP in the summer of 2005 to actively explore new market opportunities. Market research has been carried out to ascertain what the consumer expects from mushrooms and to hear from the consumer their ideas on how mushrooms should be presented for sale and what attracts them to buying mushrooms. Focus groups were established and the feedback was very interesting. Shoppers wanted to know more about mushrooms; where they come from, how they are grown and harvested, what health benefits are associated with mushrooms and in particular they wanted more information on methods of cooking and recipes.
Following this research, CMP has designed a new concept for packaging where by these consumer requirements can be met. This new packaging design can carry information on recipes, health benefits, and nutritional value and the data can be changed throughout the year. This concept has been welcomed by the large UK retailers and they have expressed interest in doing business directly with a dynamic and innovative organisation such as CMP. This was perceived as the first real effort for many years to bring any innovation to the marketing of mushrooms.
Central office and packing facility
The new CMP packhouse in Monaghan
CMP is in the process of setting up a state of the art BRC (British Retail Consortium) accredited packhouse close to Monaghan town. Following a successful application to the Department of Agriculture under the Capital Investment Scheme for the Marketing & Processing of Certain Agricultural Products, CMP have been awarded grant assistance totalling Euro474,429. This packhouse is a necessary investment by CMP PO in getting a foothold in the market place. In fact it is now very clear that for a PO to be successful and to be recognised as a PO in the short term, it must market members produce directly. This will take cost out of the system and ensure that consumers and growers are better connected with each other. CMP has been very successful in securing and maintaining PO status. This has been of critical importance to the survival of growers. There are great challenges ahead for PO's to meet with the audit requirements as enforced by the Department of Agriculture and on members to support their PO. One of the challenges is to become actively involved in direct marketing.
As Executive Chairman of CMP, I expect to make an announcement on CMP marketing shortly, all going to plan. This will be a milestone for the Irish mushroom industry where a co-operative of growers successfully negotiates a marketing contract with a major UK Retailer on behalf of its members.
CNC Compost, Milsbeek, Holland
In Ireland, mushroom production is evolving to a shelf production system. This is modelled on Dutch growing. Expansion in recent years is geared mainly towards this type of production. This system relies heavily on phase lll compost for best results. Unfortunately the supply of phase lll compost to growers is lagging behind demand. For this and for quality reasons, CMP are now sourcing compost on a weekly basis for members from Holland. A compost production company called CNC at Milsbeek in Holland, who are world leaders in quality compost production, has been doing business with CMP since November 2005. This offers growers an option of securing world class compost on their units. This partnership will lead hopefully to future improvements in compost production facilities and composting efficiency.
Employment
The mushroom industry has received some bad press recently on the issue of employment. CMP does not condone exploitation of any kind, of workers associated with the Irish mushroom industry.
CMP has been proactive in educating producer members on their duties and responsibilities as employers and the rights and entitlements of their employees. To this end, following consultation with the Department of Enterprise, Trade & Employment, and the Department of Justice, Equality and Law Reform, we have issued an information pack and made a presentation to all producer members covering all aspects of employer/worker legislative requirements and we continue to work in conjunction with the relevant departments. We provide a backup service for members on any queries arising on these maters. CMP recognise that foreign migrant workers have contributed immensely to the Irish Mushroom Industry.
Summary
CMP intend to be in the marketplace by the middle of this year operating from a new building on the edge of Monaghan town in the Republic of Ireland. At this moment, we are receiving daily calls from members awaiting our announcement on marketing to improve their livelihoods. Substantial change to current practise in the Irish mushroom industry is inevitable. CMP intends to manage that process on behalf of its members. CMP will continue to safeguard its PO status and secure the future for our remaining members.
