Tentative signs of recovery in the dairy sector – Minister Creed
After a prolonged period of price volatility in dairy markets, there are some tentative signs of recovery, the Minister for Agriculture, Michael Creed, has said.
Responding to a parliamentary question from Fianna Fail TD Niamh Smyth this week, the Minister said that he is acutely conscious of the pressure farmers are under at present.
“At present the Irish raw milk price is 6.2% above the EU average and there has been strong increase in butter prices across the EU bloc in recent weeks.
“However, volatility will continue to be a feature of global dairy markets.”
Fixed price and margin contracts, futures markets and access to increasingly flexible forms of credits are all part of the toolkit that will be required.
“There has been significant progress in each of these areas, with initiatives by processors and a new flexible loan fund for dairy and other farmers announced in Budget 2017.”
Minister Creed said that on the market front, since taking office he has led trade missions to Asia and to North Africa, with a view to increasing the profile of Ireland as a producer of quality food products, including dairy products.
“These markets are characterised by existing business relationships, but also high potential for further growth.
“The development of trade in international dairy markets for Irish producers is key to ensuring sustainable growth for the sector and is also a critically important element in mitigating market volatility.
“This work on market diversification is particularly important in the context of Brexit.”
The Dairy Quality Assurance Scheme is also critically important in developing a unique selling point for Irish dairy products on EU and international markets, he said.
Dairy processors make a substantial contribution to cover some of the costs of audits under the scheme, but of course the question of price incentives for participation is a matter for the industry.
“On-going efforts within industry, supported by Government, to move dairy production up the value chain wherever possible are also critically important.”
Minister Creed said that these efforts are supported by investment by his Department and its agencies in research and innovation.
By providing financial support for Teagasc, ICBF and Animal Health Ireland, and for knowledge transfer groups, it is investing in the provision of advice and education to farmers, to facilitate technology adoption and improve profitability at farm level, he said.
The Department is also providing support for investment at farm level through the TAMS scheme, the Minister said.