Co-ops Must Plan Further Milk Price Lifts and Minister Deliver Cash Flow Loans While Prices Still Below Break Even
Speaking from the 75th Virginia Dairy Show in Cavan, IFA President Joe Healy called on co-ops to budget for, and inform farmers of, further milk price uplifts for August milk and beyond.
He added that, with milk prices still below production costs despite the July increase, Minister for Agriculture Michael Creed must address the continuing serious cash flow pressure on farms through prompt delivery of the EU aid package in the coming weeks and by making available immediately the low cost cash flow loans IFA has proposed.
“Rapidly falling production growth in most dairy regions except the US, and a pickup in global demand have helped rebalance markets and ensured that the recovery in dairy prices has now really taken hold both in Europe and globally,” Mr Healy said.
“While this will enable co-ops to increase milk prices further over the coming months, and they must budget for those uplifts, the cash flow situation on farms will remain problematic for some time yet because prices had fallen well below production costs. Minister Creed must ensure that Irish farmers can optimise their access to both the incentivised milk production reduction and the other aid aspects of the EU aid package,” he said.
IFA National Dairy Committee Chairman Sean O’Leary added that delivering on the IFA proposed short term loans would be most critical of all in supporting farmers this year. “Cash flow shortages remain the number one problem on farms, despite the upturn in milk prices. Minister Creed must deliver urgently a financial package allowing farmers in all sectors to convert their accumulated merchant credit, utility, superlevy and other bills into low cost, short term loans they will start repaying in a year or more when incomes recover,” he said.
“We have made detailed proposals for this type of loan package, based on the state aid rules, including the €15,000 concession agreed in Brussels earlier this year, and while the response from the Minister has been positive, but the time for delivery is now,” he concluded