ICMSA stresses importance of flexible milk supply to lift prices

THE Irish Creamery Milk Suppliers Association has claimed the European Commission accepts that milk prices will not recover in the short term.

Jackie Cahill, president, said a senior commission official confirmed to the ICMSA in Brussels that emergency legislation will have to be used to support dairy markets later this year. He said Commissioner Mariann Fischer Boel’s chef de cabinet, Dr Klaus-Dieter Borchardt, described the dairy sector being in its worst crisis ever.

Mr Cahill said he told the commission that while he broadly shared its assessment of the bleak market outlook, the actions and policy it had implemented to date will not solve the income crisis being faced by dairy farmers.

A continuation of intervention beyond the normal orbit deadlines for butter and skim milk powder and the use of export refunds will not lift milk price above the cost of production at least for the remainder of 2009.

Mr Cahill said he emphasised to the commission the necessity for a flexible milk supply management system in order to permanently lift milk prices and bring stability back to the sector.

Despite all the evidence, he said the commission remains steadfast in its opposition to such an approach. It accepts the need for a cut in production but is proposing that individual farmers cut back.

Mr Cahill said that this will not happen unless the crisis is allowed to develop to an even more critical level in which case there could be a collapse in supplies as dairy farmers face financial ruin.

He urged Taoiseach Brian Cowen to support the recent Franco-German dairy policy initiative during his attendance at the heads of state and Government meeting in Brussels later this week.

Mr Cahill said the EU must match milk supply and demand and introduce proper market supports if a milk price to provide a viable income to dairy farmers is to be achieved.