Farm Ireland

Tuesday 22 January 2019

Co-ops warned goodwill generated by fodder crisis support will be 'destroyed' with milk price cut

Cattle in the sheds at Rory McEvoys farm near Mountmellick, Co Laois. Picture Credit:FRank Mc Grath
Cattle in the sheds at Rory McEvoys farm near Mountmellick, Co Laois. Picture Credit:FRank Mc Grath
Ciaran Moran

Ciaran Moran

Co-ops have been warned that they must show their understanding of the extreme hardship and stress levels on farms in the only way that will count for dairy farmers - by holding the March milk price. 

IFA National Dairy Committee Chairman Tom Phelan said Farmers appreciate the support co-ops have given through various fodder initiatives. However, the goodwill generated by these moves will be destroyed by any price cut, he said.

“Farmers have had to contend with unprecedented hardship this spring, after what was an early and long winter.

"Most have run short, or are altogether out of fodder and are only now – over a month late – seeing ground temperatures that will hopefully allow for some grass growth in the coming days. The stress among farmers who did not get a chance to rest after the hectic calving season are at dangerous levels,” he warned.

“Teagasc has put the reduced profitability for each day that the cows are not grazing at between €2.20 and €3.00 per cow.  Hence for a 100-cow herd, a three-week delay in turn out, for example, would cost the farmer around €5,500.

"The true nature of the losses may be greater as some herds have lost more than three weeks’ worth of grazing since last autumn.  Also, they will certainly rise further in the longer term, as fodder production capacity, cow condition and possibly cow fertility also suffer,” he added.

“That’s only the economics; the levels of stress on farms are seriously worrying,” Tom Phelan said.

“In these exceptionally harsh circumstances, farmers need to feel truly supported by their co-ops’ utilising some of the profits they made last year to hold the March milk price despite lower market returns,” he concluded.

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Last month, many co-ops significantly cut milk prices in the face of what the described as of an oversupply in the marketplace.

Glanbia Ireland’s Jim Bergin warned at the launch of the revamped Wexford cheese plant that there was an “oversupply situation”.

“Today, markets are trading considerably below the milk price, so therefore we will have to address that,” he added.

“Farmers should stress test their budgets at 28c/l. There has been a little bit of an improvement at the lower end but the last two GDPs have gone backwards.”

Glanbia Ireland chair Henry Corbally said they had signalled to farmers that returns were below farm gate prices and this move reflected “that reality”.

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