1 Apr 2015, 08:56
With dairy quotas abolished at midnight last night, the Oireachtas Joint Committee on Agriculture, Food and the Marine is urging dairy farmers to adopt a ‘better before bigger’ approach when considering expansion in a post-quota environment. In a report launched this morning, the Committee says that efficiencies on Irish dairy farms must be maximised before production is increased.
1 April 2015
In order to mitigate price volatility, the Committee is also calling for an insurance fund for the industry to be examined, while the logistics of forward selling in the markets should also be explored by all industry stakeholders.
The Committee, in its Report on Managing Volatility in the Dairy Industry, encourages financial institutions to take a flexible approach to farmers seeking loans, and to work closely with them to ensure funding is available for dairying expansion
Notwithstanding these calls for caution, the report paints an optimistic future for Ireland’s dairy industry as its model of sustainable, grass-based production enjoys considerable competitive advantages.
Committee Chairman Andrew Doyle TD says: “On behalf of the Committee, I wish to thank the wide range of stakeholder representatives who met us over a series of hearings. While these discussions underlined the serious challenges facing dairy farmers as a result of weak prices in the short term, the outlook for Ireland’s dairy industry in the longer term is very promising. The report outlines a number of initiatives that should be explored to mitigate price volitility, such as the creation of an insurance fund and the introduction of more forward selling.
“Committee Members are in agreement that the end of quotas herald a once in a generation opportunity for Irish dairy farmers to expand their operations and volume of milk produced without facing EU penalties for over-production. However, it is crucial that profit margin rather than volume underpins dairy sector expansion so hence the Committee’s recommendation that Ireland’s dairy farmers take a ‘better before bigger approach’. We heard cautionary tales from Northern Ireland and New Zealand, where a significant number of farms have run into financial difficulties as a result of overexpansion. Copies of the report have been laid before both Houses and will be sent to the Minister for Agriculture, Food and the Marine Simon Coveney TD.”
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Committee Membership:
Chairman: Andrew Doyle, (Fine Gael)
Deputies: Tom Barry (Fine Gael); Pat Deering (Fine Gael); Martin Ferris (Sinn Féin); Martin Heydon (Fine Gael); Michael McNamara (Labour); Éamon Ó Cuív (Fianna Fáil); Willie Penrose (Labour Party); Thomas Pringle (Independent)
Senators: Michael Comiskey, Denis Landy, Paschal Mooney, Mary Ann O’Brien, Brian Ó Domhnaill, Pat O’Neill