No soft landing for milk sector – IFA’s Downey

The likelihood of Ireland benefiting from a soft landing to the milk quota regime remains small, according to IFA President Eddie Downey. 

Speaking at the launch of this year’s Emerald Expo, he said the French are really digging their heels in on this issue. “This came up at a COPA meeting, held in Brussels last week. The French farming organisations see the opening up of Europe’s milk market as a threat to producer milk prices. And, at this moment in time, they will not budge from this point of view.”

When asked if the European Commission would consider terminating the current quota regime on December 31, 2014, as opposed to three months later, he said: “It’s a nice idea, but it won’t be supported by Brussels at the present time!”

Turning to the prospects for dairy in Ireland beyond 2015, he said that Irish milk producers can look forward to a very positive future. “Ireland will not flood world milk markets, even if we meet our 2020 growth targets. The reality is that New Zealand has the capacity to produce the same amount of extra milk in one year as the entire Irish dairy sector is projected to achieve over the next six. The demand for milk products continues to grow and Ireland is tremendously well placed to avail of the opportunities this market growth will present.”

He also said that producer milk prices in Ireland should remain reasonably stable throughout the remainder of 2014. “We have met all the dairy process0rs and made this point extremely clear to them. Given current market conditions there is no reason why farmgate milk prices should fall over the coming months. The medium- to long-term prospects for milk remain extremely positive. Yes, farmers will have to cope with a degree of market volatility in the years ahead. But it’s up to the financial institutions to provide the support farmers will need to work around these issues. Farmers will also need access to a range of additional finance options, above and beyond those that will be available from the two pillar banks.

“Young farmers can look forward to a particularly bright future in dairy. But, again they must be supported financially and in other ways, so as to ensure they can develop their businesses in the most efficient ways possible.”