Co-ops buy time as race for quota continues apace
The scramble for quota continues as co-ops procrastinate over how they will allocate processing rights when quotas end in 2015.
In the past week, hundreds of farmers have enquired about 180,000l of quota that has come to the market with 16.5ac of land in north Kerry.
Eddie McQuinn, who is handling the sale, expects the package to make more than €200,000, which will result in the quota costing the purchaser at least 40c/l.
"It's packaged to bring out the chequebooks with the minimum land and maximum quota," said Mr McQuinn, who claims his phone hasn't stopped ringing since he first advertised the sale in a local paper last week.
"The proceeds from a lot of Plc shares are being sunk into land and quota down here," said Mr McQuinn, who claims to have had one of the best six months ever in his business for land sales.
The ongoing demand for quota comes against a backdrop of predictions by Glanbia that dairy markets have already peaked. At the announcement of its half-year results last week, the company forecasts a modest weakening in dairy prices after this year.
The ICMSA's dairy chairman, Pat McCormack, said that the the co-ops needed to send out clearer signals in order to dampen down an overheated quota market.
"The lack of any real clarity from milk purchasers, with the exception of Kerry, is giving rise to some speculation that quota purchased now will have valuable processing rights," Mr McCormack said.