Measures needed to dampen ‘overheated’ milk quota market

The Chairman of ICMSA’s Dairy Committee, Pat McCormack, said that there is a pressing need for the Minister and the Co-ops to send out clearer signals regarding milk quotas and possible processing rights beyond the end of quotas in order to dampen down the current quota market which has overheated beyond realistic levels.

The Chairman of ICMSA’s Dairy Committee, Pat McCormack, said that there is a pressing need for the Minister and the Co-ops to send out clearer signals regarding milk quotas and possible processing rights beyond the end of quotas in order to dampen down the current quota market which has overheated beyond realistic levels.

“The lack of any real clarity from milk purchasers, with the exception of Kerry, is given rise to some speculation that the current price for quota is not just to cover any superlevy liability over the next four quota years - including the current year - but that quota purchased now will in addition have valuable processing rights. Dairy farmers in individual co-ops now need clarity in this matter without much more delay”, Mr McCormack.

The ICMSA Dairy Chairperson also said that the demands for extra quota is coming from various categories of farmers, including farmers who have long established plans for gradually building their quota over time and individuals who have made rapid increases in milk output in more recent times. Against this background, the management of our quota in the current year and policy and management for the remaining three quota years will be very important to ensure fair play for all farmers.

“The vast majority of farmers would see not need for massive changes in quota redistribution and allocation rules. Clearly the Minister and his Department have an obligation to take account of all legitimate claims to quota, but in so doing this they should not make radical changes in order to accommodate one group at the expense of individual farmers who have been involved for some time in a gradual expansion of their herds and have an expectation that the quota rules will not be radically altered”, cautioned the ICMSA spokesman.

“At the end of the day, fair play for the majority of milk suppliers must be the principle underlying the milk quota rules up to April 2015. Like everything else a price can be reached for quota at which purchase doesn’t make sense. Farmers faced with difficult choices should do their own figures and consult their agricultural advisors on the best options open to them. While ICMSA is not in the business of raising expectations that a solution will be found at European level, the Association is strongly of the view that the Minister for Agriculture must continuously keep the matter of an increase in the butter fat adjustment figure to the fore so that we achieve all the relief measures possible at European level to ease the growing problem of lack of milk quota”, concluded Mr McCormack.