ICMSA fears ‘bubble’ developing as exchange prices for quotas inflate

INFLATED prices for the exchange of milk quota are fast developing into “a bubble”, according to ICMSA dairy chairman Pat McCormack.

The dairy sector expert said explosion in the cost of quota should be of concern across the sector. In the case of Kerry, that increase is almost fourfold from 8c to 30c; and in Connacht Gold, a traditionally low-cost quota area, it has almost doubled from 5c to 9c per litre.

Mr McCormack said: “There are too many unknowns, many of which could be addressed and clarified in a straightforward way. In fairness to the Department of Agriculture, they have set out a system of providing information regarding the supply situation based on the average of the last three years. This system is unfortunately not followed by all co-ops.”