Farm Ireland

Thursday 22 February 2018

Farmers in milk reduction scheme will need to contact co-ops for payment

Farming Independent Team

Dairy farmers will have to contact their milk processor for the necessary forms to apply for payments under the EU Milk Reduction Scheme.

Co-ops and dairies will also act as the conduit for delivery of the completed payment forms, as processors must verify the extent of each applicant’s actual supply reduction for the three-month period from October to December.

A total of 4,447 dairy farmers applied for the first tranche of the scheme, with the reduction in milk supply sought equating to 74,225 tonnes. Given that 14.4c/l is guaranteed under the scheme, the overall payment to Irish farmers could hit €10.4m or €2,300 per applicant.

However, this level of payment is unlikely to be realised as there was no requirement on farmers to deliver on the full reduction applied for under the scheme, and the lift in milk price through the back-end of the year resulted in a lift in milk production during the period.

The EU milk production reduction scheme comes with an overall budget of €150m, it is EU wide, and it is first-come first-served.

There are limits to the reduction, farmers cannot reduce by more than 50% of the reference period production, and you cannot reduce by less than 1,500 kgs (1,450 litres)

The scheme offers four 3-month periods of possible production reductions, but the later periods will not apply if the first period is oversubscribed and uses the full budget.

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