Tuesday, 8 October 2019

Questions (346)

Jackie Cahill


346. Deputy Jackie Cahill asked the Minister for Agriculture, Food and the Marine his plans for the greater use of dairy futures markets as a tool to allow farmers to hedge against volatile prices. [40682/19]

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Written answers (Question to Agriculture)

Futures markets are used successfully in other regional dairy markets such as the United States and New Zealand. The 2016 report of the Agriculture Markets Task Force to Commissioner Hogan noted that futures markets could play a role, among other instruments, in managing volatility, but found that they were underdeveloped in the EU dairy sector compared to, for instance, the cereals sector.

Such initiatives typically have a long lead in time to gain industry and stakeholder acceptance as a viable way to mitigate volatility, and that the driving force behind any such futures market development in the EU and Ireland must be industry-led.

I have previously facilitated discussion on a range of volatility management mechanisms. I am aware of the work which has already taken place in the Irish dairy sector, including the introduction of fixed price contracts and futures contracts, to allow primary producers to hedge against volatility. I would encourage industry players to continue with this important work.