Milk production hits record levels
Milk production has hit record levels in many parts of the country over the past six weeks.
Ideal grazing conditions combined with supplies carried over from the end of March sent deliveries soaring in every co-op last month.
Kerry, Lakeland and Connacht Gold all experienced 25pc surges in supplies for April. A survey of the major co-ops shows that supplies are up nationally (21pc average) for the first month of the quota year.
While the jump in supplies has been boosted by the fact that milk production was constrained by poor grass growth last year, processors have still become extremely concerned about the superlevy situation for this year.
"We're already asking serious questions of farmers," said Arrabawn CEO Conor Ryan.
His co-op is already 10pc over quota, despite having no carryover of milk from March.
"We had no quota concerns last year so we put every drop of milk produced in March through the system," he said. "But following a board meeting [last week], we will have a letter going out to suppliers this month stating that if there is no change in the supply trends by the end of May, we will be forced to consider withholding milk payments as early as June or July."
Glanbia is considering taking similar action with its suppliers that appear to be heading over quota. It has been suggested that suppliers that produced 50,000ga more than their allocated quota last year will be the first targets for milk cheque deductions.