‘Farmer-owned co-ops must set sustainable prices for growers this harvest’

Farmer-owned co-ops must lead the way and set sustainable grain, oilseed and protein prices for growers this harvest, according to the Irish Farmers’ Association’s (IFA’s) Grain Committee Chairman, Liam Dunne.

Dunne believes that these co-ops must step up to the mark and lead from the front, as tillage farmers are now heading into their fifth season of low grain prices.

This could result in another year of low, if not negative, margins for many grain farmers, he added.

“While exceptional yields over recent years masked the income problem, a return to more normal yields this season will compound the income crisis.

Current forecasts for the Irish harvest will see cereal production fall by over 250,000t due to a combination of reduced sowings and a yield reduction.

“The relentless pressure on growers’ margins has taken a heavy toll on the sector.

“This is clearly evident from the substantial drop of close on 52,000ha in cereal sowings, which has occurred since 2012 when plantings were just shy of 315,000ha,” he said.

This trend is likely to continue unless there is a dramatic turnaround in grain prices and growers’ incomes, according to the IFA’s Grain Committee Chairman.

So far this season private merchants have been more active in the market, with their reps proactively chasing limited grain supplies.

“The merchants are leading the way on pricing with up to €148/t plus free transport being paid for green barley off the combine and €10/t to €12/t of a premium on offer for wheat.

“Co-ops, on the other hand, have been reluctant to quote and in some cases larger co-ops are selling off green barley at a discount to current market prices, effectively undermining the market,” Dunne said.

He called on the farmer-owned co-ops to take a longer-term view and to become more proactive in supporting the tillage sector.

This is even more important as increasing focus is being placed by the market on the non-sustainable dependence on non-grain feed ingredient by-products for the manufacture of compound animal feed, Dunne concluded.