Irish Malt Growers (IMG) will not secure direct negotiating rights when it comes to the fixing of malting barley prices, according to IFA Grain Committee Chairman Liam Dunne.
“I recognise IMG as a discussion group and that is as far as it goes,” he said.
He was responding to claims from IMG Chairman Tom Cushen that the new grouping must be recognised as an official stakeholder organisation within the malting barley industry.
Dunne said that the IFA provides a totally transparent service to tillage farmers, in the context of its ongoing discussions with Boormalt.
“We continually source the views of individual growers on how best to meet the needs of the sector. And I have no doubt that many of these farmers have close links with IMG.”
Dunne also took issue with Cushen’s assertion that malting barley growers need to secure a price of at least €200/t this year, in order to remain sustainable, saying that neither Boormalt nor Diageo will agree to fixed price contracts.
“What we have put in place is a contract arrangement that guarantees growers a return that exceeds feed barley prices by €40/t for 20% of their output.
“The rest is bought at a price that is linked to the MATIF milling wheat index. It must also be pointed out that the MATIF index is based on a dried grain price whereas the Boormalt contracts relate to green barley.
“We have also succeeded in having a buffer introduced this year, which will allow malting barley prices to hold up in the event of the MATIF index crashing, as was the case in 2014. And all of this has been achieved on the back of a full consultation process with growers.”
Dunne believes it is premature of IMG to cite a fixed price of €200/tonne as the benchmark sustainability level for 2015.
“The truth is that we do not know how the MATIF index will pan out over the coming weeks,” he said.