Farm Ireland

Friday 19 January 2018

'Help needed' for specialist milkers

Majella O'Sullivan

Majella O'Sullivan

YEAR-ROUND milk producers need to be compensated for their higher costs of production, the IFA has said.

The association's national liquid milk committee chairman, Padraig Mulligan, has called for a fair share of retail prices to be returned to suppliers with specialist contracts.

He has also called on processors to give "cast-iron assurances" to their suppliers that they would not downgrade their supply contracts or pricing arrangements. He said prices were currently 5c/l short of breaking even.

"Historically, the significantly higher production costs during the winter have been reflected in a price premium to suppliers," Mr Mulligan said.

"In recent years, many of those contracts have been eroded, with too many dairies fighting for market share, and new competition from cheaper milk imports.

"Dairies have progressively given away value to the retail trade with falling wholesale prices, making it increasingly challenging to secure a viable price for producers."

Mr Mulligan said a situation had now developed where too many dairies were too willing to undermine each other in a bid for market share and that retailers were the sole beneficiaries.

"It is high time our dairies got their act together and, through co-operation and consolidation, ensure that liquid milk-supply arrangements deliver a viable, higher percentage of the current retail price back to farmers," he added.

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Irish Independent