€800m could be wiped off dairy incomes in two years – ICMSA

The ICMSA estimates that dairy incomes could fall by more than €800m in the two years from 2014.

President John Comer is now calling on the Minister for Agriculture, Simon Coveney to raise the intervention price to a minimum of 28 c/L, as well as making greater attempts to re-open the Russian market for EU dairy products.

Based on 18,000 dairy farmers in the country, the Association estimates a profit per farmers of €9,500 for 2016 (excluding labour costs), down from €23,500 last year, and €39,000 for 2014. This has been estimated on an average price of 38.4 c/L for 2014, 30.1 c/L for 2015 and 26.0 c/L for 2016 – solids included.

Comer said that the Government’s stance on this issue has to move past that of spectator and a “much more concerted effort had to be made at Commission level, given the massive economic ‘knock-on’ that milk price had in our wider rural economy.”

He added that dairy farmer incomes fell €530m in 2015 and the Association is now estimating a further fall in 2016 of €280m from 2014 prices.

“The Government and the EU Commission need to very quickly wake up to this reality and introduce measures that will stabilise the situation for the sector because dairy farmers across the EU are in exactly the same position.”

“Let people be in no doubt about this” Comer warned, “many individual farmers will go to the wall unless action is taken.

“It’s going to be particularly unfortunate to see many people that were encouraged to invest by the Government, milk processors and the banks on the back of milk quota abolition being ruined by a milk price that’s hopelessly below the cost of production and an official attitude that is just wholly and demonstrably inadequate to the scale of the challenge,” said Comer.

He added that both the Government and the EU Commission have a clear responsibility to ensure that family farms are not left abandoned to the whims of processors, retail corporations and huge multinationals.

“The attitude of the key policymakers seems to be one of keeping the head down and hoping the problem will magically go away. The reality facing us dairy farmers is very different.

“We will start 2016 producing milk well below the cost of production and, at this stage and unless necessary action is taken, we’re likely to be doing so for the rest of this year.”

“Make no mistake: this is going to be a General Election issue on rural doorsteps.”

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