Dairy outlook is still positive despite processors' latest milk price bombshell
The spring of 2018 will linger long in the memory as one of the tough ones on farmers, especially dairy farmers. Most farmers are now seeing the back wall of their silage pits, something they haven't seen since the spring of 2013.
The excellent grass growth levels of 2017 have well and truly been utilised this winter and spring. As the old saying goes 'silage in the pit is as good as money in the bank' has proven to be very wise again, as it does at least twice in every decade.
The extended stay of 'The Beast from the East' has taken many dairy farmers to the limit. Most are prepared to burn the midnight oil in spring with modern compact calving patterns but, what this spring has demonstrated is when you add another factor such as bad weather into the mix it has the potential for a catastrophe.
Finally, to top it all off the milk processors drop prices by up to 3c/l - a milk price bombshell. What timing!
Just days after tanker drivers had done trojan work collecting milk in the snow from dairy farmers who braved the elements to ensure the cows were milked, the processors go and land a sucker punch.
We had announcement after announcement, almost as if co-ordinated, drip fed into the public domain. What makes the large sudden drop more surprising is that some processors had even offered to pay for milk they failed to collect in the snow just days earlier. So, what does a 3cent per litre fall in the milk price mean to dairy farmers?
The average farmer in Ireland this year will milk 100 dairy cows, the 3c/l fall will reduce income on this family farm by €17,250 (see table 1). Imagine if the salaries of all civil servants and politicians were slashed by this sum there would be public mutiny. In fact, some of the processors managed to increase remuneration to board members and management just before the price reductions.
It all smacks of a distinct lack of care and respect for their dairy farmer milk suppliers. We all know that international markets, particularly milk powders are presently taking a hit on price, but surely the price fall could have been spread out over the coming months, if only as an act of solidarity between milk processors and milk suppliers.