Northern Ireland - Pressure grows on dairy farmers
Published:June 6, 2006
Source :Farming Life
Fane Valley chief executive, David Graham, has told Farming Life that this week's United Dairy Farmers' milk auction prices are an accurate reflection of the growing pressure on international dairy markets at the present time.
For the second successive month, the average price at the United Dairy Farmers' milk auction was two pence per litre down on last year's levels.
At this month's auction, held on Thursday, the average price was 17.61 pence per litre, an increase of 0.24ppl on the May 2006 auction, but just over 2ppl behind the auction in June last year.
"Since the Mid-Term Review of the CAP, the EU Commission has cut export refunds on a range of dairy products and the Intervention price for butter. We also know that significant quantities of cheese were made last autumn and this extra product is now coming on to the market,'' he explained.
"Throw in a weakening US Dollar plus the growing international impact of the milk industries in the southern hemisphere and one can quickly gauge why there is so much pressure on producer milk prices here in Northern Ireland at the present time.''
David Graham added: "Naturally, I am extremely disappointed at the current state of affairs. The local dairy industry is seeking to find ways of improving this situation.
"And adding value is certainly an option from an ongoing investment point of view. However, this is a long term project and don’t forget that every other country in the world is doing the same thing.
"Producer prices could start to pick up again in the autumn. But this will be dependent on a decision by the Commission in Brussels to increase export refunds and the degree of influence New Zealand will be having on the market at that time.''
In response to the latest milk auction results, the Ulster Farmers' Union has announced that office-bearers and representatives of its dairy committee are to meet with 12 milk processors over the coming weeks.
"Our aim is to ascertain the future prospects for milk production in the medium to long term,'' commented Union spokesman, Joe McDonald.
"We will also be asking the processors what they intend doing to increase the value of the milk supplied to them.''
He added: "We are now extremely concerned about the long-term viability of many dairy farms in Northern Ireland. Adding to the impact of the poor milk price are issues such as the Nitrates Directive and the need to undertake significant capital investment on-farm. On quite a number of units the figures involved could exceed £100,000.
"And, given that such an investment will not result in any additional income generation for the farmer, the question now arises as to the feasibility of going ahead with the work in the first place.''
Joe McDonald admits that the current slump in producer prices is a direct result of the EU Commission's ongoing attempts to bring European milk prices more in line with those in the rest of the world.
"Brussels is also quick to point out that Single Farm Payment money is now available to compensate for any fall in milk prices,'' he said.
"But that's not the point. The issue is one of maintaining a viable milk sector in Northern Ireland. And we will continue to lobby the Commission on that basis.''
