Farmers exiting the dairy sector could lose an estimated €1,770/cow removed, while farmers reducing numbers could lose an estimated €2,910/cow, the Food Vision Dairy Group has claimed in a final version of its report.

The report, which has been seen by Agriland, outlines the potential income foregone for farmers.

The report states that:

  • If the cow removal is an element of a full destocking and exit from dairying, the appropriate income metric to use is net margin, and the income foregone is €590/lactation or €1,770/dairy cow removed, assuming three remaining lactations;
  • If the cow removal is an element of a partial destocking where the participating farmer remains in dairy production but with fewer cows, the appropriate income metric to use is gross margin, and the income foregone/lactation is €970 or €2,910/cow, assuming three remaining lactations.

It does not indicate what payments farmers could receive if taking part in an exit or reduction scheme.

However, it does state that “securing the level of public funding required to incentivise the adoption of this scheme would be a key challenge”.

The Dairy Food Vision Group states that “detailed negotiations at senior political level” would be required to secure significant public funding to support its proposed recommendations.

The report details that the estimated income which “would be foregone” by farmers is based on analysis conducted by the Department of Agriculture, Food and the Marine (DAFM), which took into account the following factors:

  • The cull value of the animal;
  • The profit that could be generated in the production of milk versus the next-best alternative activity, e.g., beef attending or tillage;
  • For farmers that might opt to exit milk production, the relevant profit metric would be net margin, whereas gross margin would be more appropriate for those that would opt to reduce a small number of animals;
  • The number of expected remaining lactations.

The report estimates that for every 100,000 dairy cows reduced, emissions could be lowered by 0.45Mt of carbon dioxide (CO2) equivalent (CO2e).

More to follow….

FOOD VISION 2030 FOOD VISION DAIRY GROUP REDUCTION SCHEME