There are circumstances when the dairy sectors throughout Ireland should join forces to maximise the prices that can be delivered back to farmers, according to UFU President Ian Marshall.
“There are tremendous opportunities to be availed of in the emerging markets of South East Asia and China. But the dairy sector must act as a combined unit in order to maximise all of this potential,” he said.
“And this must include co-operation on a north:south basis. Such an approach makes perfect economic sense. And the fact that a high degree of cross border ownership of milk processing plants already exists, make such an approach all the more realistic.”
The Union President went on to confirm that the dairy sector is on a slow road to recovery. But he would not commit as to how long it will take for the industry to turn the corner nor the milk price that will be required to deliver profitability at farm gate level.
He also indicated that Northern milk processors are paying the best possible they can at the present time.
“The returns generated by the dairies reflect their respective product mixes,” he said.
“But profitability at farm level is not wholly dependent upon milk prices. Issues such as fertiliser, feed and energy costs are all critical factors in this equation. So it would not be right for me to commit to a specific, break-even farm gate price.
“However, it is critically important for the markets to deliver the best possible returns for producers. And in this regard we need to see China coming back into play and actively procuring dairy products.
“The Russian food ban is another important market-related factor as are the levels of milk production in New Zealand and the export intentions of the US dairy sector.
“The reality is that cheap US corn is the worst of all news stories for the dairy sector here in Northern Ireland, as it will encourage the significantly enhanced production of milk in the United States.”