A group of farmers significantly impacted by fixed milk-price schemes are engaging in a mediation process with Tirlán.
The group, which does not want to be identified, claims it has been adversely impacted because of inflationary costs and the differentiation on milk prices versus fixed prices.
Farmers that participate in these schemes are locked into fixed margins regardless of any fluctuation on milk prices.
Some people in the group of farmers impacted claim their participation in fixed-price contracts resulted in an individual loss of revenue in the region of up to “€100,000” last year.
Fixed milk-price contracts
Although members of this group of farmers readily acknowledge that they “voluntarily” signed fixed-price contracts they believe – particularly in relation to Tirlán’s fixed milk price scheme 17 – that some “insurance mechanisms” should have been built into “protect” participants.
They claim that because no cap on volumes was specified in contracts by Tirlán that the co-op “should accept responsibility” for the position that some fixed milk-price suppliers now find themselves in.
Some also believe that financial institutions that “aggressively” encouraged farmers to sign up for fixed milk-price contracts should also shoulder part of the responsibility for farmers who are now “struggling” because of the contracts.
Tirlán introduced a fixed milk-price support scheme last year to assist farmers who were heavily exposed to the fixed milk-price scheme.
It is estimated that in the region of 500 farmers have more than 35% of their milk supply tied up in these contracts.
In December, the co-op contacted farmers with its latest Fixed Price Scheme Support offer.
Confusion and anxiety
At the time, Stephen Arthur, the Irish Farmers’ Association (IFA) dairy chair, warned that the offer had created “confusion and anxiety” among Tirlán ‘s suppliers.
He also criticised the deadline of December 30, 2022 that the co-op had set on the offer and called on it to organise public meetings in January to explain what the latest offer entailed.
Tirlán has confirmed that it will host a number of “Farmer Information Meetings” for co-op shareholders and suppliers from mid- January.
“The regional information meetings will provide shareholders and suppliers with an opportunity to engage directly with Tirlán management and board members.
“An online meeting has also been organised to facilitate those unable to travel and details on how to join will be shared closer to that date,” the co-op stated.
IFA meeting
In the meantime, the IFA has organised a meeting for Tirlán’s fixed milk suppliers tomorrow (Friday, January 6) at Newpark Hotel, Co. Kilkenny at 11:00a.m.
The IFA has invited the co-op’s board and management to the meeting to discuss the new fixed milk-price support scheme offer.
Stephen Arthur said the aim of the meeting is to “clarify” the latest updates to the support scheme.
“There is genuine confusion around this, farmers urgently need clarification on it all,” he said.