Irish consumers have one of the highest per-capita consumptions of fresh drinking milk in the world, but every year less and less milk is produced during the winter months.
Those campaigning for the liquid milk sector suggest that the new post-quota profile of the shape and pattern of the manufacturing milk production model will be characterised by early spring compact calving and a longer lactation period.
As registered producers increase their annual production, the proportions of their annual milk supplies destined for manufacturing will increase, while the proportions for liquid consumption will decrease.
For many registered milk producers, this change in their supply portfolios, with manufacturing milk becoming their main market, will be a major challenge to their commitment to providing year-round supplies for the liquid milk market.
Registered producers will require a clear framework and adequate winter milk price incentives to ensure their commitment to continuing to produce year-round supplies of fresh quality milk for consumers in a relatively stable domestic market.
Big milk drinkers
Last year, the consumption of fresh milk on the domestic market increased by 4% to 601 million litres, the highest national consumption of fresh milk on record. Price competition between retailers, to maintain grocery market shares in a changing market environment, continued to exert strong downward pressure on domestic market returns for fresh milk.
Price of a litre of milk
According to the National Milk Agency, the national average retail price for fresh milk in all pack sizes was estimated at 91 cent per litre. This was a slight decrease of 1 cent per litre on 2014.
Northern imports
Imports from Northern Ireland into the fresh milk market amounted to 156 million litres, or more than one in four of litres consumed.
Registered contracts
1,725 milk supply contracts were registered with the agency for supplies of 461 million litres of milk for processing for liquid consumption, representing a decrease of 8% in contracts and 3% in milk supplies.
Average price paid
The average price paid was 33.04c/litre under the manufacturing plus bonus price, while under the flat system, the average price paid was 31.38c/litre. This represents reductions of 6.52 cent per litre and 6.83 cent per litre respectively.
Registered producers
The number of registered producers with contracts has fallen by over 1,000, or 37%, since 2003. The average annual supplies of registered producers to end 2014 remained remarkably stable at over 825 million litres. In the past 10 years, the number of registered contracts has reduced from 2,336 to 1,725, a reduction of 611, or 26%.
National milk supplies
Overall national milk supplies increased by 13%, while the total annual milk supplies of registered producers increased by 9%, or 72 million litres, to 893 million litres. Of this, 471 million litres, or 53%, were supplied for processing for liquid consumption and 422 million litres, or 47%, were supplied for manufacturing into dairy products.
Level of cover
In the five prescribed winter months of October 2015 to February 2016, total milk supplies by registered producers amounted to 309 million litres, an increase of 39 million litres or 14% on the supplies in 2014/15. This provided a supply cover of 123% for liquid milk consumption (including imports) of 250 million litres or a supply cover of 167% on consumption from domestic supplies only.
Imports
Last year, bulk milk imports into the state for processing by creameries and pasteurisers were the highest on record and amounted to 594 million litres, representing an increase of 83 million litres, or 16%, on 2014. Bulk milk imports were mainly cross-border movements of milk from Northern Ireland and were equivalent to 9% of domestic supplies and 26% of Northern Ireland’s annual milk supplies in 2015.
Size of supplier
Average annual milk supplies per supplier in Northern Ireland in 2015 was 826,000 litres, which was more than double the average milk annual supplies per supplier of 363,000 litres in the Republic (see Table 1).
Introduction: plan required for winter milkers
Liquid milk industry road map required to ensure it continues