Farming Poll 2016: 33% say they might cut milk production, compared to 2% 12 months ago

One third of dairy farmers in the Irish Examiner ICMSA farming opinion poll wanted to accept an EU financial incentive to cut milk production.

Twelve months previously, only 2% said they had any interest in cutting production.

Back then, improved prospects for dairy farmers around the scrapping of milk quotas in April, 2015 was still the feelgood story of recent years in agriculture.

But a two-year fall in global milk prices has dampened enthusiasm.

A different, sobered dairy farmer has emerged from this year’s Irish Examiner ICMSA survey.

At agricultural shows between August 14 and September 4, 209 dairy farmers were among the 526 taking part in the survey.

Farming Poll 2016: 33% say they might cut milk production, compared to 2% 12 months ago

Despite milk prices starting to lift in mid-August from a two-year low, they were far from happy with how their profession is going, with optimism in milk production sliding from 84% in 2014 to only 64% now.

Their co-ops will be hoping they can continue monthly milk price rises on top of last week’s increases of as much as 2.5c per litre — because this survey reveals that dairy farmers may be ready to take out their disappointment at deterioration in dairy earnings on their co-ops.

Over the past three years, dairy farmers were asked how much did they intend to change their milk output.

In 2014, 48% said they would increase milk production by 10-30%.

In 2015, that gung-ho attitude was at 46%, but only 24% think that way in 2016, according to the survey results.

The intention to increase milk production by more than 30% has shrank to 9%, from 17% last year, and 15% in 2014.

Farmers had until last Thursday to apply for a 14c EU payment for every litre by which they cut production in October, November, and December, compared to 2015.

When asked in the Irish Examiner ICMSA survey about this incentive to cut back, 50% said it won’t affect their production, 18% said it won’t affect their production provided their co-ops start paying them extra for milk, but 33% said they intended to accept the incentive and cut milk production.

This points to processors having to cope with an unexpected fall in milk throughput at dairy plants in the last three months of this year.

A breakdown of the answers from the 209 farmers indicates fairly even responsiveness across the age and acreage ranges to the 14c/kg milk reduction offer.

Farmers aged 45 to 54, or on very small farms, seemed slightly less interested in cutting back.

Even more revealing were the responses of the 209 farmers when asked again this year about their attitude to their dairy co-op.

The biggest change came when farmers were asked if they agreed or disagreed that they “would like to see their dairy co-op becoming part of an amalgamated larger group”.

After a year of low milk prices, 38% now agree, compared to only 23% 12 months previously.

In 2015, 56% were happy with their co-op standing alone, now only 41% think so. This change in attitude is fairly consistent across farm sizes and farmer ages.

Change was in the air also when the dairy farmers were asked did they “expect to be supplying the same dairy co-op with milk five years from now”.

Yes, agree 74%; only 10% disagree. But 82% indicated loyalty in 2015.

Co-op loyalty rises in line with farm size, from only 56% on small farms to 80% on 12 acres or bigger farms.

Dairy farmers have also been asked in 2015 and 2016 are they happy with their co-op’s milk supply agreement. Now, 24% disagree, up from 16%. Don’t knows have increased from 12 to 17%, and only 60% remain happy with their milk supply agreement, compared to 72% a year ago. Smaller farmers seem the unhappiest with their co-op’s milk supply agreement.

The Irish Examiner ICMSA survey also gave dairy farmers a chance to comment on how well they thought the EU and National Government responded to the dairy income crisis.

Since 2014, the EU has injected nearly €1.5 billion of emergency aid for dairy farmers.

There is agreement among 38% of dairy farmers that the response was sufficient; but 48% disagree.

Larger scale farmers and older farmers were less happy with the help they got.

  • Results are expected imminently from the Department of Agriculture in the

Gerald Quain, Chairperson of the ICMSA Dairy Committee, said this scheme is sending a clear signal to the milk market that Europe is slowing down production, aiding the on-going recovery in the market which benefits every farmer, even if they do not enter the scheme.

READ MORE: The Irish Examiner / ICMSA farming survey: Methodology 

Find more on the Irish Examiner ICMSA farming survey HERE


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