The Munster Dairy Producer Organisation (MDPO) is hoping to receive formal recognition from the Department of Agriculture, Food and the Marine (DAFM) within a week.
Over 200 people logged onto an online information meeting last night (Thursday, January 18) for an update on the new producer organisation being spearheaded by a group of Kerry Group milk suppliers.
The suppliers, who held meetings and participated in protests last year, are unhappy at the milk price being paid by Kerry.
As their current contracts with Kerry Group are due to expire at the end of 2025, some suppliers have moved to establish a producer organisation which would negotiate with milk purchasers on behalf of suppliers.
A steering committee was established last year to advance the new group.
Producer organisation
Limerick-based barrister and agribusiness consultant, Ciaran Dolan presented an overview of the initial set of rules, which he has drawn up, for the new producer organisation.
Dolan, a producer organisation facilitator approved by DAFM, has already been involved with the establishment of two beef producer organisations.
He told the meeting he is hopeful that the new organisation will get formal recognition from DAFM in the coming week.
“I’m reasonably happy that the rulebook in its present state will be acceptable to the department,” he said.
Once the department approves the establishment of the producer organisation, membership forms will be distributed in the coming weeks and a website will also be developed.
Members will have to be an active dairy farmer which may not be limited to just Kerry Group suppliers. They will also have to sign a membership form and paid a membership fee.
It was noted that all information supplied by farmers to the new organisation would be covered under data protection legislation.
Democratic
The meeting heard that the core mission and objective of MDPO is to collectively strengthen the position of its members in negotiating and agreeing contracts, including price for the supply of milk and for the purchase of farm inputs and services.
Dolan stressed that a producer organisation has to be democratic and all members shall have equal voting rights.
MDPO will elect nine members to sit on a council or board which will manage the business and operations of the producer organisation, similar to a co-op.
An interim council will be put in place pending the election of members to the council between 12-18 months after the formal establishment of the organisation.
A team will be established to negotiate with potential milk purchasers and will have the power to conclude draft agreements which would then need to be approved by members.
The rules of the producer organisation can still be amended or altered through a the approval of a resolution by two thirds of the members of the interim council.
The meeting was also addressed by two directors of the Davidstow Creamery Direct (DCD) Limited, a dairy producer organisation based in Cornwall in the UK.
The organisation represents milk suppliers for Saputo Dairy UK, formerly Dairy Crest.
Milk price
Diarmaid Mac Colgáin, founder of Concept Dairy, told the meeting that Irish milk prices are looking likely to hit the 40c/L mark.
“It’s looking like the number will be a four definitely, it’s just how quickly will it get to a four in terms of the milk price. Hopefully, we’ll be seeing it by March,” he said.
Mac Colgáin said there was still a lot of uncertainty, but as Easter is falling early this year it could give prices “a bump”, due to demand from processors.
He noted that Irish milk supply was down 13% in November as “there’s a lot of people deciding that it is not worth doing it anymore”.
“We’ll only really see those numbers as we come into the flush in April/May time, what the numbers are really like, the effects of derogation and everything else.
“If that happens it could push up prices but the only thing about that is if there’s less milk going through the [processing] plants, that means the overheads are still there and that might keep the price down,” Mac Colgáin said.