One farming organisation has questioned why the decrease in international input prices is not being reflected in the prices that Irish co-ops are offering.
President of the Irish Creamery Milk Suppliers’ Association (ICMSA) Pat McCormack has said that “an alarming gap” is opening between the milk price being paid to farmers by their co-op and the corresponding input costs they are charging.
He stated that during 2022, global input prices rose and prices in the Irish market followed suit, but asked why this knock-on effect hasn’t come into play now that international figures are falling.
“If prices on international markets dictated those rises last year, why are reductions in inputs internationally not working their way through to reductions in the prices charged by our co-ops now?
“For long periods last year input costs had actually surpassed milk price and farmers were left running to stand still, but [they] could at least look at specific inflation causes and figures and know what was happening.
“What’s happening now is that the prices in Ireland are remaining mystifyingly high when the farmers can just as easily see that they are falling steadily internationally,” he said.
The association is calling on Irish co-ops to make “a concerted effort” to reduce what they are charging “because we all know and the data proves that Irish figures are notably above where international markets say they should be”.
“This is a crucial time for dairy farmers, and we are going to insist that the co-ops act with the same speed and decisiveness on reducing what they charge for inputs this year as they showed last year when they cited those same markets when they kept on raising fertiliser and other input charges,” stated McCormack.
He said a pattern like this is very concerning and leaves farmers paying more than they need to for input costs, which “in the very recent past”, has led to “ruinous periods”.
“Milk price fell below the costs of production and many suppliers were wiped out for periods of up to 18 months,” he said.
He added that this will not be allowed to happen again and if it were moving in that direction, “ICMSA would aggressively monitor the real cost of dairy inputs and demand that where they fell, that the co-ops reflected that in exactly the same way and with the same speed as was reflected when the cost of inputs was going up”.