Farmers to protest over dairy quota and falling milk prices

DAIRY farmers yesterday called on the Irish Creamery Milk Suppliers Association to organise a major protest in Dublin over the threats posed to their €1.1 billion industry.

Angry delegates to the association’s annual general meeting in Limerick vented their anger over milk quota policies and falling prices which would, they warned, force many dairy farmers out of business.

One delegate even called for a national milk strike, similar to those undertaken by dairy farmers in Germany and France, to highlight their plight in a time of unprecedented uncertainty in the industry.

A meeting of the ICMSA national council in the next few weeks will decide on what action to take.

Jackie Cahill, president, said Agriculture, Fisheries and Food Minister Brendan Smith and his officials may have been fooled by the European Commission on the abolition of milk quotas and by extra quotas in the lead up to that happening.

But he said the minister should not to attempt to fool dairy farmers with the fantasy that the extra quotas are worth €100 million.

“The extra quota will cost us hundreds of millions in terms of reduced incomes over the coming years,” he said.

Mr Cahill said the current position of Ireland, in not seeking the retention of milk quotas beyond 2015, is foolishly predicated on an ever-increasing world demand.

“If milk price fell from 33 cent per litre down to 27 cent per litre, which I argue is, unfortunately, a likely scenario; it would mean an income reduction of €306 million representing in turn a 44% reduction in farm incomes,” he said.

Mr Cahill said farmers are being told by so-called experts that they would or should respond by way of increased production.

But a staggering 11.6 billion litres of milk would have to be produced in Ireland to offset the fall in income due to price reduction.

“As our current quota-production is five billion gallons, milk output would have to increase by 230% to merely recover the loss of income due to price reductions. This is the proverbial meltdown situation,” he said.

Mr Cahill also announced the ICMSA has instructed its legal team headed by Gerard Hogan SC, to initiate legal action on behalf of a number of farmers if the Government does not respond immediately and process the Farm Improvement Scheme applications, which have been held up fore more than a year.

Addressing the meeting last evening, Mr Smith said he disagreed with Mr Cahill’s view that his policy of seeking additional quota was contributing in any direct way to the current downward pressure on milk prices.

The outcome of the Common Agricultural Policy health check in securing a net increase of over 9% in additional quota, combined with the retention of essential market support measures, was an exceptional achievement.

“This is equivalent to an additional 500 million litres, compared with 2007. Based on existing milk prices, the value of these production rights amount to some €100m,” he said.

Mr Smith said the extra quota will pave the way for a “soft landing” before the abolition of quotas in 2015.

“This is great news for progressive dairy farmers who, for too long, have been starved of the potential to expand their dairy enterprises,” he said.

Minister Smith said he is satisfied the Irish dairy industry is well equipped to take advantage of the long-term positive outlook for dairy markets and that producers have the potential to significantly increase milk production in the short term.