Anger as report finds farmers share of retail milk price has fallen to 26%

FARMERS are enraged by analysis of the 2009 National Milk Agency Report, which shows that the farmer’s share of the retail milk price has fallen from 43% in 1995 to just 26% today, says the ICMSA.

Irish Creamery and Milk Suppliers Association (ICMSA) dairy committee chairman Pat McCormack said that milk processors need to squeeze better margins from retailers and give dairy farmers a fairer share of milk sale profits.

He said the price being offered by Glanbia and others to liquid milk producers for winter 2010 is utterly inadequate.

The ICMSA leader said dairy farmers are furious over what they see as a deliberate strategy by processors and retailers to boost their own margins at the expense of farmers.

The ICMSA is to bring increased pressure on co-op boards to insist that liquid milk is sold at a price that is sustainable for both the producer and the processor.

“The current strategy could only be described as a race to the bottom,” said Pat McCormack.

“Liquid milk producers will not survive unless they receive a fair share of the market returns. Farmers’ margins are being squeezed to the absolute bone and the current prices on offer are simply not sustainable.

“All farmers want is an adequate, reasonable margin. Yet, time and again, we see our margins being slashed so that the multiples and other parties closer to the supermarket till can have their already generous margins increased.

“It’s not right and it’s economically absurd over the medium to long term.

“What we need is a situation where co-op boards instruct their management to stop selling milk at a price that is simply not sustainable and return prices to producers based on a reasonable margin above the costs of production.”