The Irish Farmers Association (IFA) strongly believes the current milk price and the price being obtained by the co-ops for the commodity are not in balance and there is some scope for additional payments to be made to farmers at the end of the year.
Speaking to AgriLand this morning, Kevin Kiersey, chairman of the IFA dairy committee said: “We feel commodity prices saw significant improvement over the summer months and have remained relatively strong in the autumn. However the milk price has not fully justified the price co-ops are getting for the commodity.
“We feel there is a certain percentage out there that the co-ops should pass back to farmers in the form of a bonus top-up payment at the end of the year and we will continue to lobby for that.”
“We just feel there is some room there to reward farmers. In an ideal world based on the total milk supply and price and relative to the Irish Dairy board index there could be scope for up to €80m additional payments back to farmers.”
Kiersey noted: “Relating the Irish Dairy Board price index in 2010 to today’s index, it has seen a significant rise. We feel the milk price should rise to the same extent. We are aware that co-ops would have subsidised prices to some extent at the start of the year during the bad weather and we appreciate that.”
Looking forward to 2014 Kiersey observed: “We would also be calling on the co-ops to hold the milk price into the spring. There has been some bit of pull back on world markets in recent weeks. However the trend is for prices to remain stable. We feel that co-ops should make a commitment to farmers to hold prices moving forward.”
Results published by the IDB for October showed that for the first time since June 2012 the performance of the Irish dairy sector has decreased on the previous month. The Production Price Index (PPI) showed a return value of 131, which implies 31.1 per cent increase in market returns when compared to 2010.
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