Production fall 'must and will' have positive impact on milk prices

The latest milk production figures for July released by the Central Statistics Office “underline graphically” the effect the drought conditions had on dairy farms this summer, according to the Irish Creamery Milk Suppliers’ Association (ICMSA).

Commenting on the figures, the ICMSA Dairy Committee chairman Gerald Quain noted that Irish milk production fell almost 27 million litres in July 2018 compared to July 2017.

Also Read: Irish milk production dropped by 3.1% in July

This fall of 3.1% reflects the immediate knock-ons of the extreme weather and challenges around adequate feed and grass over the period, he said.

While acknowledging both cause and effect, the chairperson was adamant that the fall in supply is likely to be replicated across the EU and beyond.

He said that this must and will have a positive impact on prices as the extent of the fall in milk produced works its way through the chain.

“Prices on European wholesale markets have increased over the last number of weeks with returns for the Butter / Skimmed Milk Powder mix running at almost 35c/L and Whole Milk Powder over 32c/L.

“The fact for farmers is that revenues are being eaten up by the increased costs associated with the drought and fodder challenges.

“But that doesn’t detract from the imperative of getting the highest prices possible from the marketplace back to farmers as they struggle with those increased costs for the remainder of 2018 and into 2019,” Quain stressed.