The higher costs associated with producing winter milk relative to creamery will be exacerbated with rising input prices, Irish Farmers' Association (IFA) liquid milk chair Keith O’Boyle has said.

O’Boyle stated that a higher liquid milk premium would be needed by processors to encourage farmers to produce milk into the high-cost-of-production months on farms.

“Producing fresh milk for shop shelves requires farmers to milk their cows all year round at significant extra cost compared to milk which goes for manufacturing. This is now being compounded by the surge in input prices,” O’Boyle explained.

Extra costs and effort

The rise in creamery milk price has heightened the disparity between the two production systems, the liquid milk chair added.

“While the price of milk for manufacturing has been going up, this is eating into the extra premium farmers are normally paid for producing fresh milk all year round.

“More and more, farmers are questioning why they are taking on the extra costs and effort needed to milk all year round. Liquid milk farmers need a bigger premium,” he claimed.

Retailer fairness

An increase in the volumes of cheaper ‘private label’ milk moving through retailers has also acted to the detriment to liquid milk producers, O’Boyle continued.

Cabinet’s approval of the office of food ombudsman was acknowledged by O'Boyle.

Retailers must increase the retail price of milk and pass the entire differential back to the primary producer

“This office must ensure a fair wholesale price for private label milk. The dominance of private label milk sales in Ireland has eroded the margin paid back to farmers to such an extent that a regular and consistent supply of milk on our shop shelves cannot be guaranteed,” said O’Boyle.

Milk prices have been eroded to the point where year-round supplies cannot be guaranteed, with an increase to farmers’ milk cheques needed to rectify this emerging issue, he said.

“In the meantime, retailers must increase the retail price of milk and pass the entire differential back to the primary producer. Price won’t be as a big a concern if retailers cannot secure a sufficient supply of fresh milk this winter,” he added.