THIS is the fourth year that ICMSA and the Irish Examiner have come together to commission and publish what has become the most definitive snapshot of the attitudes and ambitions of the farming community, writes John Comer, president of the ICMSA.
We are proud of our association with this survey. It seems to us to be more vital than ever that the voices of the farmers themselves, from every part of the state, across all ages and through all sectors, are allowed to express their current feelings on a wide range of issues unfiltered by any particular agenda or preconception.
That was our original aim in getting involved and we hope that the integrity and independence of those motives is reflected both in the findings and in the spirit with which they will be received. That this year’s survey shows a sector both anxious and increasingly pessimistic cannot be surprising.
The Brexit referendum was a profoundly disappointing – not to say shocking – result. We want and need our access to our British markets to remain as unimpaired as it is now.
Decades of work and reputation-building have gone into our development of a market that takes over 40% of all our agri-exports.
We can confidently anticipate that the UK will want free access to the EU market and we can - on the basis of the Commission’s statement thus far – be equally confident that the EU will be demanding free movement of labour as a quid pro quo for that free movement of goods.
It already looks certain that this will be the crux of the matter and we must all realise and without a moment’s hesitation that it is a matter of the highest national importance that the final settlement between the UK and the EU, when it comes, does not involve tariffs or any other barriers to our UK food exports.
We have already lost between 10% and 15% through the fall in Sterling relative to the Euro and have seen already the first casualties of this (from our point of view) terrible decision. This decision goes a long way to explaining the fall in morale and confidence evident throughout this year’s survey. But it is not the sole reason.
The 18 month-long collapse in milk price – only just showing signs of reversing – has left our dairy farmers, the ‘jewel in the crown’ of Irish farming, on their financial knees.
It has been a catastrophe that has wiped out any of the ‘feel-good factor’ that came in the immediate aftermath of quota abolition. ICMSA accepts happily that quotas were a blunt tool that had outlived any usefulness they ever had.
But the transfer to a free market without any supervision of supply-chain margins has given our milk suppliers nothing less than an income wipe-out.
For the majority of the last year, our members have been receiving a price per litre up to seven cents per litre below the cost of producing that litre.
Throughout that time, the Commission’s attitude seemed to vary from idly standing by to groundless expressions of confidence that the markets would rise in ‘due course’.
What the EU’s dairy farmers were meant to do while they waited for ‘due course’ was left unaddressed. Right throughout the EU, dairy farmers saw their incomes not so much plummet as disappear.
Earlier this year, ICMSA and its partner organisations in the European Milk Board (EMB) faced up to the reality that an oversupply of milk meant that there was no prospect of a farmer milk price rise.
Accordingly, we supported the introduction of a Voluntary Milk Production - Reduction Scheme that would allow individual farmers to receive 14 cents per litre for every litre less produced over a set 2016 period relative to 2015. We were alone in advocating this course and were criticised by milk processors and their representative bodies, but nevertheless we persevered in calling for the option to be put on the table.
The Commission agreed with the policy put forward by EMB and it’s fair to say the results speak for themselves. Since the announcement of the policy, every GDT has seen a surge in price and farmer milk price has increased in two consecutive months.
ICMSA is not claiming that the Supply Production-Reduction scheme is the only reason behind the rally. But we are most certainly saying that it was a component of the dairy market recovery - and a very large component at that.
It has concentrated the minds of our processors wonderfully about their own volumes and that has led to price increases as they correctly wonder whether their planned volumes will materialise.
For the first time, dairy farmers had an option produce or not and milk processors were forced to respond.
In the same way as ICMSA was correct on this, we are equally correct about the distribution of the €11m EU Dairy Crisis Fund. That money was specifically allocated to the alleviation of the incomes wipe-out experienced by milk suppliers.
It should not - and must not – be distributed throughout every sector of farming and it certainly must not be used as a form of bank collateral/subsidy as advocated by some.
The State must match the funding and pay every dairy farmer a flat €1,200 per person. The money – and it’s paltry enough – must be used for the purpose the EU intended.
John Comer is president of the ICMSA
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