Poll shows majority of Irish dairy farmers will not apply to Milk Reduction Scheme

It appears that the majority of Irish dairy farmers will not be applying to the EU’s Voluntary Milk Reduction Scheme after an Agriland poll showed that 63% of farmers will not be applying to the scheme.

Under the EU package of measures to try and combat the dairy crisis, an EU-wide scheme to incentivise a reduction in milk production, worth €150m was announced in July.

Further details of the scheme were announced recently by the Commission which included farmers being able to claim for a maximum of 50% of their milk production and that there will be penalties for failing to reduce production for the full amount (14c/L) offered.

Next week, it is expected that farmer application forms and help-sheets on the scheme will issue to co-ops, with the temporary measure opening to applications this month.

milk supply

The Commission has said that the scheme will be run as a “simultaneous examination”, meaning that the Commission will accept all bids notified by the relevant Member States by the agreed deadline.

This will apply unless the claims exceed the volume (1.07m tonnes) corresponding to the available budget, in which case a reduction coefficient will be applied.

Further periods (for November-January, December-February, and January-March) will follow until the budget volume is reached, it confirmed.

Once the period is over, farmers will then have 45 days to provide the proof that they have reduced production – following which the aid can be paid.

Also under the most recent package of measures, it was announced that Ireland is to receive €11m, from a total fund of €350m, from the Commission in support funding.

Like the first package of aid measures announced in September 2015, the Irish Government has the opportunity to co-finance Ireland’s €11m allocation.

The French government has already decided to match its EU funding allocation of €49.9m. Under the French scheme for the first 5% of production cutbacks, producers reducing their production will receive a compensation of 24c/kg. Beyond this limit, the compensation will be 14c/kg.

However, last week a source told Agriland that a decision by the Government to co-finance the monies was ‘not a foregone conclusion’.

It is also understood that lump sum payments, which dairy farmers received in 2015 under the first aid package, to farmers are also off the table.

Meanwhile, both IFA and ICMSA have clashed over what way the €11m monies under the scheme should be spent.

IFA has called for the monies to be used to provide farmers with low cost short-term loans in order to help cash flow difficulties on farms.

The ICMSA however, has called for the money to be allocated to farmers in the form of a €1,200 direct payment, which it says is permissible under the regulations of the scheme.