The Irish Farmer’s Association (IFA) liquid milk chair, Keith O’Boyle, has said that the market will be left short on fresh milk during the winter period, because, without a realistic return, many farmers will switch to a seasonal milk production system.
This is as the CSO agricultural input price index shows an almost 35% increase in the price of agricultural inputs in the last year. The chair says the increase has to be an integral part of liquid milk pricing to ensure a supply of fresh milk this upcoming season. It is expected that the increases may persist in the medium term.
CSO figures show that the price of agricultural inputs has increased by 34.8% in the12-month period to March 2022. He argued that the increases must be reflected in the price offered to farmers.
O’Boyle commented that the IFA will be using the CSO Agricultural Price Index in negotiations with processors. He added that “to ensure the market is not short of fresh milk, the price a supplier receives from a processor should be set on the basis of manufacturing base price, plus solids, plus a premium indexed to input costs.”
“Maintaining a year-round supply of fresh milk incurs significant costs and adds further complexities to the milk production system. All of which leads to a higher cost of production for the farmer,” he pointed out.