Slump in farmers' milk prices wipes €1bn from the wider economy
End of quota tightens the screw on rural families
Plummeting dairy prices have wiped more than €1bn from the rural economy, as farm families feel the pressure of the fallout from the end of milk quotas.
It was touted as a major opportunity for dairy farmers when, on March 31, 2015, the quotas that had limited production for 30 years and curtailed the country's milk pool came to an end.
Yet a year into the new dairy era, many farmers are facing major cash-flow worries during the busy springtime, as the milk price has slumped almost 40pc from the highs of 2014.
The 'wipe-out' has been described as worse than the last major trough that hit in 2009 and is causing major concern across the EU's dairy industry.
The slump in milk prices has wiped more than €1bn from the rural economy, where agriculture has been touted as a fail-safe in recent years in securing jobs during the downturn.
The ICMSA (Irish Creamery Milk Supplier Association), which represents dairy farmers, has calculated that a 37pc slump in milk prices since 2014 shrank milk cheques by €627m during 2015 and in 2016, as low prices continue.
If an economic multiplier of 1.7 is applied, this brings it to just over €1bn, taking into account the wider impact on the economy.
The slump comes as the European Commission accepted a French proposal to reduce the milk supply or effectively move towards voluntary quotas by paying farmers to stop producing milk.