Superlevy bill to total €10.5m as milk deliveries come in above quota

Ireland’s superlevy bill is expected to total around €10.5m, down from the expected €15m, with Department of Agriculture figures confirming overall level of milk deliveries for the 2013/14 milk quota year at 0.65% above quota.

Agriculture Minister Simon Coveney said the national position is less than the earlier estimated 0.94%, largely due to a lower level of butterfat content in milk this year.

“Last year was a good year for Irish dairy farmers in terms of increased income as favourable weather and prices combined to drive higher supplies,” Mr Coveney said.

“The eventual superlevy fine, while undesirable in the first place, will be lower than expected and dairy farmers can focus on preparing for quota abolition next April.”

Mr Coveney also announced that the total volume of milk supplies for the first two months of this quota year — April and May — taking into account the relevant butterfat adjustment, leaves Ireland at 9% over quota at the end of May. This compares to being 4.64% under quota at the same point last year.

He said strong prices, good weather, and high cow numbers may result in Ireland being over quota again this year unless production is managed carefully. He urged milk producers to keep in mind the expiry of the milk quota regime next March when planning output for the year ahead.

“While I have sought and continue to seek amendments at EU level to improve the ‘soft landing’ for Irish dairy producers in collaboration with other like-minded member states, unfortunately there is no common position at the council of agriculture ministers and for the moment such an improvement looks unlikely to be achieved,” Mr Coveney said.

“However, I have requested the matter be on the agenda for discussion at July council where I and other member states with whom I have been working on this will once again seek to have the matter progressed.”

Meanwhile, IFA dairy chairman Sean O’Leary urged dairy co-ops to preserve goodwill with farmers by holding their June milk price. He cited the cashflows of dairy farmers under pressure from the costs of the increased stock numbers ahead of the end of quotas.

Mr O’Leary said the superlevy fines were yet another cost which dairy farmers would have to carry. He urged the co-ops to hold their June milk price to allow farmers maximise their peak milk income.

“After a six-month slide, and a few weeks of relative stability, EU average dairy prices are now very definitely firming,” he said.

“In the last four weeks, butter prices have increased by €110/t to €3540/t, SMP by €50/t to €2890/t, WMP by €30/t, cheddar cheese by €50/t, and whey powder by €20/t. EU commodity returns for June 22 would return slightly over 42c/l before processing costs for an Irish product mix, and would easily sustain current milk prices.”


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