Speaking at the Teagasc Open Day on dairying in Moorepark today (Wed), IFA President Eddie Downey called on the Minister for Agriculture Simon Coveney to ensure that the EU Commission fulfils its obligations by reviewing dairy intervention prices.
“The pressure on milk prices has been intensifying in recent weeks, and they have been falling well below the €30/kg breakeven threshold. Meanwhile, there has been no account taken of the massive long-term increase in production costs incurred by farmers, and a revaluation of the butter and SMP intervention prices is now well overdue.”
Eddie Downey has been in contact with the EU Commissioner for Agriculture Phil Hogan to express his concerns on dairy prices, and to ask him to undertake an immediate review of dairy intervention prices. The Commission is mandated under Article 7.2 of the European Parliament and Council Regulation 1308/2013 – the regulation within the CAP which deals with ‘Common Market Organisation’.
Commenting on the issue, IFA National Dairy Committee Chairman Sean O’Leary added: “At a farm gate price equivalent of around 22c/l, current intervention prices simply cannot credibly be described as a “safety net”. Production costs have increased strongly since 2008, the last (downward) adjustment of the intervention price, I believe an increase of the intervention prices is well overdue”.
“We have also raised with the Commissioner, both directly and through our European organisation COPA, the desirability to retain within the dairy budget the estimated €700m of total EU 2014/15 superlevy – a massive drain on European dairy farmers’ resources even after the quota regime has ended.”
Speaking to farmers at the Moorepark event, Eddie Downey said good business and financial planning and on-farm efficiency were critical elements for all farmers, and especially for those planning expansion.
He said the experience from all over the world where expansion has taken place is that those farms that borrowed excessively were under most pressure due to market prices and volatility. Eddie Downey welcomed the opening of the Dairy Equipment Scheme as part of TAMS II and said he will be meeting the banks in the coming weeks to ensure farmers were supported through the downturn in prices.