Following the announcement of a decision by Arrabawn to sell its liquid milk sales book to Aurivo and cease processing at its plant in Kilconnell, Co. Galway, farm organisations have expressed their frustration with the move.
The Irish Farmers’ Association (IFA) described the development as a “serious indictment” of the liquid milk sector in Ireland.
Keith O’Boyle, the association’s liquid milk chairperson, said: “The IFA has been highlighting the precarious situation of the liquid milk business for the last number of years and this is now playing out with Arrabawn leaving the sector.
“We cannot have a situation where any other processor or farmer feels forced to leave the liquid milk sector.
“The only way to guarantee this is by retailers paying a fair price for fresh milk. If this doesn’t transpire, a regular supply of fresh milk on supermarket shelves is in real jeopardy,” O’Boyle added.
The IFA liquid milk chair said that Arrabawn’s liquid milk suppliers “must not find themselves at any disadvantage from this proposal”.
O’Boyle commented: “There is an onus to ensure they are fully accommodated and not forced into changing their dairy farm systems due to the decision of their milk processor to exit the business.”
Meanwhile, the Irish Creamery Milk Suppliers Association (ICMSA) said the end of processing at the Kilconnell plant by next summer is “a major disappointment”.
According to ICMSA president Pat McCormack, the situation is a “direct result of the growing and concentrated power” of the top retailers in Ireland.
McCormack said that the ICMSA has been in contact with Arrabawn stressing the importance of liquid milk producers still having an outlet for their milk under terms and conditions that “at a minimum” must be on par with what is available with Arrabawn.
The association has also called for a guarantee that the affected milk suppliers can remain in the liquid milk business.
“The liquid milk business has been systematically undermined over many years by a relentless margin-squeeze exerted by retailers on both the processors and farmers.”
“Unless and until politicians do something to stop this, there will be further closures in rural communities like Kilconnell where farming, food production and processing are the economic basis for everything else,” the ICMSA president said.
“If politicians want to prevent these closures, they need to immediately introduce legislation to curb the power of the large retailers and allow farmers and processors the opportunity to make a reasonable margin from liquid milk production,” McCormack argued.