Milk prices comparable with EU but seasonality hits returns

DAIRY farmers get a good price for milk compared to their EU counterparts, but are hit in terms of return per litre due to the seasonality of the current product mix, according to the ICOS dairy industry review group.

Leaders at the co-op group met to discuss the findings of a recent KPMG analysis of Irish dairy processing.

The report highlighted a number of key areas of competitiveness that the sector needs to address. However, it also pointed out numerous positives that are gained from collaboration and co-operation between the co-ops.

ICOS president Pat McLoughlin said: “The extent of collaboration that has taken place within the industry to co-operate with the study is very encouraging. On this basis, we can reasonably look forward to further significant progress.”

The KPMG report noted that Irish milk processing costs compare favourably with the international peer companies selected. However, it did highlight the need to improve energy cost per ton, together with plant utilisation at peak and optimisation off peak.

ICOS chief executive Tom O’Callaghan said: “The analysis conducted by KPMG has been invaluable in that it has laid out the facts in relation to the actual position of the Irish dairy industry in its global context. The work to date highlights the tangible efforts and achievements made to date, while demonstrating that there is no room for complacency.

“With considerable expansion on the cards, the industry can be well positioned to match the ambitions of Irish dairy farmers in the years to come. Further progress can and must be made in the weeks and months to come. We look forward to the members of the industry group consulting with their own boards, and reconvening in the coming weeks to consider an appropriate way forward.”