Banks will have to step up and support dairy farmers who may face cashflow shortfalls due to the sharp drop in milk price, the IFA has said.

Following an urgent meeting of its dairy committee, the IFA said it plans to engage with banks and other credit providers to ensure farmers are properly supported financially over the coming months.

Farmers are really worried as they face potentially very large tax bills this autumn, IFA dairy chair Stephen Arthur said.

“The milk price is falling rapidly, while our input costs are going the other way and that’s going to lead to significant financial pressure. Fertiliser is still a huge cost, meal is still as high as €415/t – there has to be some sort of an adjustment on meal,” he said.

The global dairy market, Arthur said, has shattered and its value has completely shrunk.

“Global dairy markets remain challenged, mainly due to ample global supply of dairy product and particularly sluggish demand, especially in China.

“While initial market assessments suggested a recovery in the final quarter of 2023, it is doubtful that markets will recover before year end,” he said.

Arthur added that an increased number of calls have been received by the IFA from farmers facing pressure from co-ops to settle their accounts.

“There seems to be a heavy crunch for money in the last two or three weeks. Farmers will always pay they just need a bit of time,” he said.

The IFA, he said, is also urging co-ops to keep the price of milk supported the best they can.

’Suffering in silence’

Arthur said the big concern with the fall in milk price are the farmers who are facing these pressures but are suffering in silence.

“There are lots of farmers who will give out about the situation and they’ll ring me or they’ll ring somebody. But there’s an awful amount of farmers who will ring nobody, these are the people we want to be looking out for,” he said.