Super levy is a serious concerm for some farmers
The super levy is a serious concern for some farmers.
The deterioration in world market prices for dairy products is seriously affecting milk prices, which are likely to remain relatively low for 2015.
However, a more positive outlook in the medium to long term is forecast.
This time last year, I wrote here that the most important event in 2013 governing the future of tens of thousands of family farms and rural Ireland would be the EU decision on distribution of single farm payments (SFP).
As it transpired, the EU decision was fairly satisfactory, but the distribution of the new payments by Minister Coveney and supported by the main farm organisations is of grave concern among the 80% of farmers who have been getting very poor SFPs in the past. The new system is close to what we had already.
It has been a good year for milk production and milk prices.
However, favourable conditions led to serious over-quota problems for many farmers.
There is no satisfactory solution to this problem.
Under-feeding cows must be avoided, in order to avoid long term problems.
Feeding as much milk as possible to calves and feeding a low protein ration to cows, or selling some cows, will help — but there is no way to avoid substantial penalties for many.
Based on Teagasc analysis, there is likely to be about a 25% drop in milk price in 2015.
Farmers should plan for this now, and examine all possible options to maximise income.
However, in the longer term, there is generally good confidence in dairying.
Much of this confidence is based on the fact that the world’s population is growing rapidly and the demand for food, including dairy products, is estimated to increase by 40 to 50% over the next few decades.
Most of the increase in demand will come from countries that have hundreds of millions of poor people, whose wealth is improving.
Dairy farmers are facing into a whole new world with the ending of milk quotas in sight.
International sources forecast volatile prices of between 24 and 34 cent per litre for the next decade.
There is a consensus among international forecasters that shortage of food and higher prices will be the global experience in the foreseeable future.
Most farmers ease the physical work load a bit over the Christmas season.
This kind of break often allows time for planning and thinking about the future.
But mental work such as planning can be even more stressful than physical work; give it a skip for at least three or four days over Christmas.
I wish all my readers a very Happy Christmas
