Speaking after he led an IFA elected officers’ top level meeting with Glanbia yesterday in Portlaoise, IFA President Joe Healy said they had strongly impressed on GII’s CEO Jim Bergin and Chairman Henry Corbally the genuine concerns suppliers have about the sustainability for them of the GII milk pricing model.
“Glanbia farmers are well aware that market returns are poor, and that a recovery will take some time. Meanwhile, Glanbia GII and Glanbia Plc must be prepared to share the pain of low market prices, as farmers feel they are being made to bear more of it than they can take, and they fear constant resorting to finite co-op resources is simply not sustainable,” he said.
“We told Glanbia clearly yesterday that they need to be open to providing additional price support from their own resources, to show empathy and prove they are sharing the risk more fairly with farmers. We are prepared to engage with them to explore ways in which they might do so.”
National Dairy Chairman Sean O’Leary added: “Glanbia, followed by Dairygold – two of our biggest milk processors – have cut their March base milk purchasing prices to levels which, at 22c/l and 23c/l respectively, are shockingly below production costs for the vast majority of milk producers. Glanbia producers received 2c/l additional top ups 1c/l of which comes from finite co-op resources, while the other is a one-off Ornua bonus”.
“Not only are these drastic milk price decisions damaging to farmers’ cash flow, they are destroying their confidence at a time when most have invested heavily on farms. It is simply unfair and unreasonable for our milk purchasers to expect farmers to keep producing milk to utilise processing capacity regardless of whether or not they break even on their farms,” he said.
“Our industry model must be sustainable for farmers if it is to deliver on its real potential. It can only do so with a fairer sharing of price risks in which the farmer is not just being paid what is left over after all other costs have been serviced,” Sean O’Leary concluded.