Commenting today (Thurs) on the decision by Glanbia shareholders to approve the co-op’s 2015 farmer support programme, IFA National Dairy Committee Chairman Sean O’Leary said that while the move was important in the context of challenging months ahead for dairy farmers’ incomes, it was vital that the provisions would be fair to all producers, and would not undermine the mainstream milk prices.
“2015 will be a difficult year for dairy farmers: lower prices than farmers had hoped for, superlevy fines and tax liabilities will significantly erode cash flow. We in IFA have called on all stakeholders, especially co-ops, to provide dairy farmers with a supportive framework to help them manage their business through the difficult early few months of 2015. In this context, the move by Glanbia is a welcome contribution, as it seeks not only to support milk prices, but also to help with the payment of superlevy fines and to somewhat reduce the cost of inputs,” Mr O’Leary said.
However, Mr O’Leary said it was crucial that any support measure implemented would not detract from the payment of the strongest possible milk price, nor should it be subject to restrictions unfairly preventing certain groups of suppliers from benefiting.
“It is crucial that any support mechanism implemented by co-ops does not undermine the main stream milk price. Furthermore the GIIL joint venture was established to make the necessary processing investment, but also to establish a debt free co-op with the potential to support milk prices. In light of this, all supplier shareholders should be eligible to receive the milk price support, without restrictions,” he said.
“Later this spring, IFA will hold regional seminars to challenge the dairy industry, banks, input providers and advisory service providers as to what strategies and instruments they will develop to support dairy farmers through the difficult early months of 2015, and for future episodes of volatility,” he said.
“All these stakeholders stand to benefit greatly from the planned dairy expansion, and they owe it to primary producers to help them sustain the profitability levels they will need to deliver on the milk output growth,” he concluded.