Farm Ireland

Tuesday 26 March 2019

Milk quotas: Production to soar while farmer numbers fall by 3,000

Ireland will see the number of dairy farms actually drop, even as milk production soars
Ireland will see the number of dairy farms actually drop, even as milk production soars
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Aideen Sheehan

Ireland will see the number of dairy farms actually drop, even as milk production soars.

The country is set to produce an extra two billion litres of milk a year by 2020 as the shackles of milk quotas are finally cast off.

Agriculture Minister Simon Coveney has predicted there will be an extra 300,000 cows in the national herd, bringing the total to over 1.3 million by 2020.

However, though every area of the country will see an upsurge in production, experts agree it won't be evenly spread, with some areas profiting more than others - and there'll be fewer farmers producing it.

Currently there are close to 18,000 dairy farmers producing 5.5bn litres of milk a year - but this is far from evenly dispersed, with production concentrated in Cork and other southern counties as well as Meath, Cavan and Monaghan.

It is likely that the south will see a boom in milk production of around 60-70pc, whereas in the west the increase will be between 10-20pc, said TJ Flanagan, head of dairy policy with co-op umbrella group ICOS.

"Dairy production requires reasonably large blocks of land that makes it easier to get the cows in for milking, but in the west you'd have smaller, more scattered farms that make it harder to expand," he said.

While there will be an increase in Cork, it was already pretty saturated with cows, whereas some tillage farmers in Wexford, Waterford, south Tipperary and the south east were likely to switch to dairying as they had suitable land, he said.

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Structural change in the sector will continue - with the number of dairy farms likely to decline from 18,000 now to between 12,000 and 15,000.

In the 40 years since milk quotas were introduced, the number of dairy farmers in Ireland has plummeted from 144,000 in 1975 to just 18,000 now, though the average herd size has increased sixfold to around 60 cows.

John Comer of the Irish Creamery Milk Suppliers Association (ICMSA) agreed continued consolidation of farms is inevitable. He expects that the number of dairy farmers will decline by around 5pc a year, to around 15,000 by 2020 and to 10,000 to 12,000 in the longer term.

"My priority in the ICMSA is to ensure that the single-farmer-operated dairy farm with between 50 and 90 cows will remain viable under the new regime, but that can only be achieved if there's a reasonable price for milk," he said.

Teasgasc data shows Cork remains the epicentre of the Irish dairy industry with 4,277 dairy farms and nearly a third of the national herd.

A recent study by Cork Institute of Technology predicted that the county will see a 50pc increase in milk output by 2020, creating 4,000 new jobs.

It said that €1.2bn is being invested in dairying in the county at farm and processing levels and the increased output will be worth €450m a year.

Irish Independent

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