New IFA boss criticises Glanbia over price paid to milk suppliers

The new president of the Irish Farmers' Association, Joe Healy, has criticised milk processor Glanbia over the price it is paying to suppliers.

Mr Healy said dairy farmers were being made bear the brunt of the current downturn as a result of the company’s aggressive pricing model.

“Glanbia must be prepared to share the pain of low market prices, as farmers feel they are being made to bear more of it than they can take, and they fear constant resorting to finite co-op resources is simply not sustainable,” he said.

Last week, Glanbia cut its base milk price for March to 22 cent a litre, its lowest level in seven years.

Mr Healy led an IFA delegation to meet with Glanbia officials in Portlaoise on Wednesday.

“We told Glanbia clearly that they need to be open to providing additional price support from their own resources, to show empathy and prove they are sharing the risk more fairly with farmers,” he said.

The IFA’s national dairy chairman Sean O’Leary said: “Not only are these drastic milk price decisions damaging to farmers’ cash flow, they are destroying their confidence at a time when most have invested heavily on farms.”

“It is simply unfair and unreasonable for our milk purchasers to expect farmers to keep producing milk to utilise processing capacity regardless of whether or not they break even on their farms,” he added.

Glanbia insists its current milk price reflects weaker returns for the commodity, while noting a significant portion of its suppliers were on fixed-price contracts, which shielded them from the worst of the slump.

The average milk price paid to farmers here has fallen from 38 cent a litre in 2014 to a current rate of 24-25 cent a litre.

A glut in production globally but more recently in Europe following the removal of quotas, a slowdown in Chinese demand and Russia's trade embargo, have fuelled the worst market slump in a decade.