Dairy sector hit with €16m fines for quota breach
DAIRY farmers are being hit with fines of up to €18,000 each for producing too much milk.
The EU Commission has confirmed that Ireland will have to pay a "superlevy" penalty of €16m for producing more milk than it is allowed under the quota system.
The bill will fall on individual farmers and will range from hundreds of euros to well over €10,000 for some big producers. Most farmers will have already had this money docked from their co-op milk cheques over recent months, so they don't have to pay it in one go.
Ironically, the fines are partly down to good weather during the 2011/2012 milk quota year, which led to bumper grass growth and high supply when world milk prices were temptingly high for farmers.
The European Union milk quota system was introduced over 30 years ago to limit milk production in return for the higher prices paid to EU farmers but is due to be abolished in 2015.
In total, Ireland produced 60,000 tonnes more milk than its quota in the last year and was one of six countries in Europe that did so, even though total EU milk production was actually 5pc below its maximum level.
The Irish Farmers' Association said the €16m fine was a massive cost on dairy farming but EU officials have refused to reduce it.
While dairy farmers were attempting to scale up in preparation for the ending of quotas in 2015, they needed to be extremely careful not to incur further big fines before that date, as the EU was not showing any signs of a lenient approach, said IFA dairy chairman Kevin Kiersey.