‘Milk production drop estimated to cost €15 million’

The drop in milk production during the fourth month of this year could equate to a loss of about €15 million in dairy farmer incomes, the Irish Creamery Milk Suppliers’ Association (ICMSA) has estimated.

Earlier today, figures released by the Central Statistics Office (CSO) indicated that milk production on farms in the Republic of Ireland fell by 5.9% in April of this year compared to the same month in 2017.

Commenting on the news, the chairperson of the ICMSA’s Dairy Committee, Ger Quain, said that statistics confirmed that – as suspected – the “severe winter and spring” has resulted in a “very substantial drop” in milk production.

He maintained that this drop in production will feed into the overall picture for 2018 in several ways.

 Obviously the first and most serious consequence is in terms of farmer income, the difference in production between April of this year and April 2017 will – we estimate – work out at about €15 million less in dairy farmer incomes.

“That is without even going near the constituents and the impact that we’ll see there.

“The loss of income will be compounded by the extra costs incurred in getting through the spring in terms of fodder and feed, and it leaves us in a position where we can say – even at this half-way stage – that 2018 is going to be a year of challenges, stress and pressure.

“However, the reduction in global milk supplies will feed back almost immediately into a stronger market, as buyers look at the supply statistics and projections – and purchase forward in the expectation of reduced supplies coming onto the market from all of the significant producing regions,” he said.

Continuing, Quain explained that this trend is already being seen in dairy product prices – with butter, in particular, moving upwards.

“It means, as far as the ICMSA is concerned, that there can be no possibility whatsoever of co-ops reducing their May milk price when they come to announce them over the next fortnight and – in fact – milk price increases now need to be put back on the agenda,” Quain concluded.