The Ulster Farmers’ Union (UFU) has expressed concerns that dairy farmers’ expenses could be putting Northern Ireland’s milk supply at serious risk. Mervyn Gordon, UFU dairy chairman, has emphasized that additional costs farmers are currently carrying must be alleviated by both retailers and processors – so that farmers can “receive a fair return from the booming dairy market”.
He warned that if the price of milk and dairy products in shops do not rise correspondingly, Northern Ireland could be set for a “milk scarcity”. Gordon said: “If they can’t cover the basics, how can they be expected to continue running a farm business that is supposed to support a family and home?”
UFU’s statistics show that in February this year the average pint of milk cost 49p (86p per litre). And by 28 March it cost 60p (£1.05 per litre), an increase of 22%. Last month the average base milk at the farmgate rose by just 1.75p.
“When dairy products are doing well in the market with prices rising, you would normally see an increase in the amount of milk being produced off the back of it, as farmers want to take advantage of improved returns. However, the eye-watering productions costs are having the opposite effect,” he said.
The chairman added that, worryingly, the full impact of cost increases is still likely to be felt by the dairy sector. “Farmers are struggling to keep their head above water as it is and if things continue like this, their cash flow will be well into the negative in a matter of months. We need retailers and processors to get behind our dairy farmers and help protect local milk production here in NI, so they can continue producing to meet consumer demand.”
His takeaway message is that farmers’ extra production costs need to be alleviated by those further up the supply chain, otherwise dairy farmers may be forced to reduce output in response to unsustainable input costs.