Co-ops paying ‘same milk price as in 1995’
A “disappointing lack of ambition” has been reported by Irish Farmers’ Association (IFA) members from co-op board members they have interacted with in recent days, according to the organisation.
IFA National Dairy Committee meeting chairman Tom Phelan reported the findings from members following the association’s March milk price co-op board lobbying campaign.
“A number of industry leaders have flagged a milk price of 30c/L for 2019,” Phelan said.
This is the same standard price as farmers received for their milk 24 years ago in 1995, despite the massive investments made by farmers and industry to improve milk quality and lift our product mix further up the value chain.
The chairman added that IFA committee members are tired of the “fudging” carried out on VAT.
“Co-ops have identified 30c/L as a psychologically important benchmark for farmers,” he said.
“30c/L including VAT is 28.46c/L + VAT, which represents a price cut of nearly 2c/L compared to current averages – and that’s just not good enough in light of current market returns.
“After all, the exchequer pays the VAT – not the co-ops – so they should not use it to make milk prices look better than they really are,” he said.
Members are also annoyed when some co-ops quote the average price paid, at real constituents, in an attempt to inflate their price.
The chairman described this as amounting to “high-jacking” and taking the credit for farmers’ own efforts in achieving higher quality, butterfat and protein over the last decade.
“This too is unacceptable to farmers,” he added.
“Finally, our members also reject the discourse by some co-ops that the relatively clement winter and early spring, in contrast to last year’s weather shocks, compensated farmers well enough regardless of milk price.
“This is infuriating to farmers, and to quote one of our members speaking yesterday, ‘nature is merely putting back now some of what it took from us last year’,” Mr. Phelan said.
“Co-ops must show a little more ambition.
They must support farmers who are only just picking up the pieces of last year’s stress, cash-flow troubles and bills through the best, stable milk price current market returns clearly allow.
“Their first move must be to hold the March milk price,” he concluded.