Disappointing Caution by Co-ops Must Be Offset by Commitment to at Least Hold Until Spring

IFA National Dairy Committee Chairman Tom Phelan said the decisions for September milk prices had been disappointingly cautious in light of the fact that many co-ops still pay less than the Ornua PPI, never mind the September EU returns as reported by the EU Milk Market Observatory.

He said the same excessive caution was applied by most for their August milk price.  This was bitterly disappointing for farmers, at a time when Teagasc predicts a 50% drop in 2018 dairy farm incomes, and many farmers still have fodder deficits which will be costly to offset over the winter.  The least co-ops could do was to make a clear commitment to, at worst, hold their current milk price till spring.

“Farmers have delivered significantly higher volumes of milk in both August and September, despite the huge human and cash flow challenges caused by the vagaries of the weather and the difficulties and cost of keeping cows fed.  By stalling milk prices from August while many of their European counterparts (Friesland Campina, Arla, Lactalis…) were flagging price uplifts right up to October, and in some cases to year end, Irish co-ops have disappointingly let down their suppliers, and bagged large volumes of cheaper milk to boost trade,” Mr Phelan said.

“We understand that market circumstances for the months ahead are more uncertain, with the challenges of global trade wars and Brexit in particular.  However, IFCN’s CEO Torsten Hemme, at the organisation’s annual conference in Italy in September predicted clearly that global demand for milk would continue to outpace supply for the coming months and years, which should underpin strong dairy and milk prices,” he added.

“I urge all co-ops to take a good look at the situation of their milk suppliers, and to support them through to the end of one of the most challenging years this generation of farmers has ever experienced, to commit solidly to, at worst, holding current milk prices to spring 2019.”

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