Farm Ireland

Wednesday 22 November 2017

Quota woes leave co-ops in fine mess

Darragh McCullough and Declan O'Brien

As the EU confirms that there will be no flexibility on milk quotas until at least 2013, the picture for the country's co-ops is rapidly becoming a case of the 'haves' and 'have nots'.

The situation on the ground has improved for some of the smaller dairies in the past month but the two main players, Glanbia and Dairygold, are still running well ahead of quota.

However, efforts by the dairy industry to wrangle concessions from the EU Commission to offset a major superlevy fine appear to have been rebuffed.


A spokesman for the Commission said there were no plans to look again at the butterfat co-efficient or the superlevy fine, which stands at 28.66c/l.

A move on either issue would help offset any national superlevy fine which will exceed €25m given current supply trends.

"The Commission has set a clear path towards the end of quotas in 2015, and there are no plans to adjust those plans," the EU spokesman said.

Commission insiders accept that the milk management measures have been raised by countries other than Ireland in the early stages of the CAP reform negotiations.

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However, given that a final CAP deal is unlikely to be agreed before the end of 2013, the timeframe to agree concessions ahead of the end of the milk quota regime is limited.

Meanwhile, Glanbia and Dairygold are still in trouble, with joint supplies running at 6-7pc -- 115m litres -- over quota.

Despite huge falls in supplies, a multi-million euro superlevy bill looks inevitable for many suppliers as farmers with quota to spare are milking on to make the most of strong prices.


However, there are a number of regions where it looks like dairy farmers will escape superlevy fines.

With supplies now running 8-10pc lower than the same period last year, Kerry, Lakeland and Town of Monaghan bosses are hopeful of coming in under quota. Connacht Gold appears to have no such worries, with milk supplies for the quota year to date already under.

The situation is different elsewhere, with Wexford and Lissavaird fairing best at close to 3pc over quota.

Bandon and Barryroe are some of the worst affected, with supplies running 7pc over. Glanbia isn't far behind at 6.7pc.

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