Dairy farmers focus on growth despite cost/price squeeze

Speaking at the second IFA regional dairy meeting in Carrick on Shannon, on the theme of “Dairy 2020 – Focus on Confident Growth”, IFA National Dairy Committee Chairman Kevin Kiersey said dairy farmers’ confidence had taken a severe dent this year as a result of an unprecedented cost/price squeeze made worse by the appalling summer weather.

Speaking at the second IFA regional dairy meeting in Carrick on Shannon, on the theme of “Dairy 2020 – Focus on Confident Growth”, IFA National Dairy Committee Chairman Kevin Kiersey said dairy farmers’ confidence had taken a severe dent this year as a result of an unprecedented cost/price squeeze made worse by the appalling summer weather.

He said it was crucial that co-ops in the West of Ireland and all over the country would pass back urgently the strong market improvements in higher milk prices to help farmers return to profitability as soon as possible. For the longer term, he highlighted the need for clear communication by co-ops and the Irish Dairy Board of the new markets and products they have identified for the additional milk Irish dairy farmers will produce post-2015, and the need for action on milk and input price volatility.

The meeting in Carrick on Shannon was addressed by Irish Dairy Board Secretary and Director Administrator Anne Randles, and by Connacht Gold Co-op CEO Aaron Forde.

“I am clear that there is growing demand on global markets for dairy products, and real opportunities there for Irish farmers. However, farmers will produce more milk only if they are confident that their processors and marketers know what they will process it into and where they will sell it profitably. Farmers will produce more milk if it makes economic sense for them to do so, and if they have confidence in their industry,” Mr Kiersey said.

“This series of regional meeting is about giving an opportunity to dairy farmers in the West of Ireland and the rest of the country to question the Irish Dairy Board and their co-ops as to their plans to secure their future,” he said.

“In addition to clarity on the industry’s plans, farmers will need help to deal with the impact of volatile margins on their cash flow. The industry must devise plans to mitigate the worst aspects of volatility at milk price and input price levels through a combination of innovative milk pricing systems, fiscal-based solutions and the greater prevalence of fixed-price contracts. We in IFA are quite committed to working with industry on this, but volatility management must be included in all co-ops’ plans for the pre- and post-2015 era,” he concluded. The next regional IFA dairy meeting will be held in Kilkenny on Thursday 20th September, and will be addressed by the IDB’s Commercial Director Bernard Condon and Glanbia Dairy Ingredients CEO Jim Bergin.