‘Current milk pricing model is not working for young farmers’

The current milk pricing model is not working for young farmers, according to Macra na Feirme.

The organisation questioned the current milk pricing model, at yesterday’s Dairy Forum chaired by Minister for Agriculture, Michael Creed.

It also questioned payments of milk top-ups based on litres only instead of the kilograms of solid milk supplied

Macra National President Sean Finan said that the pricing model should be based on a monthly or quarterly forward pricing system which would enable farmers to budget more accurately.

Such systems are common place across other dairy producing countries and facilitate farmers to manage price volatility.

Finan also encouraged the Dairy Forum to focus on the structural and strategic issues affecting the industry.

Speaking prior to the Dairy Forum young dairy farmer Kieran McDermott, a member of the Macra na Feirme Agricultural Affairs Committee said that a major issue is the payment on litres only instead of on kilograms of the milk solid supplied.

“This has a significant impact on farmers especially at this time of the year when milk solids are high.

“Efficient farmers could benefit more from a payment system on kg of milk solid, especially in a year where every cent counts on dairy farms.”

Ornua’s presentation on the global market outlook for 2017 predicted an estimate of 30-33c/L.

The Macra President said that we need to gain clarity as to the European plan regarding the release of skimmed milk power (SMP) held in intervention.

“Any release of SMP onto the market must be effectively managed so as not to disrupt the improving market price.”

Macra na Feirme was represented by National President Sean Finan, Chief Executive Denis Duggan and Agricultural Policy Manager, Derrie Dillon at the forum.