Prudent cash-flow planning is required by farmers for the last year of the milk super levy, the IFA advised yesterday.
It followed confirmation by the Department of Agriculture that milk supplies to the end of June exceeded quota by a record 7.05%.
The Central Statistics Office has also disclosed that January to May production was up 8.5%.
IFA National Dairy Committee chairman Sean O’Leary referred to strong profitability, exceptional weather conditions and good availability of high-quality fodder.
He predicted that these would push Ireland’s milk supplies over quota and into a potential record super levy situation for the last year of the quota regime.
Mr O’Leary said this would impose a high cost on farmers, which they needed to plan for prudently, without damaging cash flow or herd potential.
“Irish milk supplies reflect the global trend of exceptionally fast output growth, and for the same reasons, conditions and on-farm profitability are both good.
“However, farmers need to remember that super levy is with us for one last year — and production looks set to exceed our quota quite considerably over the coming months, as farmers gear up for the end of the regime,” he said.
Mr O’Leary said it is crucial that farmers would seek assistance from their Teagasc or private adviser to adopt husbandry and production techniques which will allow them minimise their production surplus without impeding the future potential of their herd.
“It is also vital that farmers be assisted by their co-ops and banks in financing the super levy bill a very large number will face next year. This must be planned as early as possible, and the cash-flow of farmers protected as much as possible in the process,” he said.
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