IRISH DAIRY farmers may go on strike this year because processors have cut the price the farmers get to about 6 cent below cost of production on each litre.
The main processors: Glanbia, Dairygold, Lakeland and Kerry co-operatives, have reduced the price paid to farmers for milk produced last month, causing anger in dairy circles.
The president of the Irish Creamery Milk Suppliers Association, Jackie Cahill, said Glanbia and Dairygold planned to pay 20 cent a litre and Kerry 22 cent a litre despite the fact they know farmers must get 27 cent a litre to produce at a break-even point.
“It is a frightening situation especially now we know the EU supports which could put a bottom on the market are already used up. Dairy farmers are taking a terrible battering and losing money. For many of us there is nowhere to go, especially now there are few off-farm jobs available.”
Mr Cahill said his organisation would examine all options open to it, including withholding milk supplies if necessary.
“At this stage we have ruled nothing in or nothing out because the industry is in chaos.”
He indicated the major retail outlets could become the focus of attention for angry farmers as consumers were now paying up to 112 cent for a litre for which farmers receive only 20 cent.
“The price of milk continues to drop but consumers have not had any benefit from that. The price of cheese and milk has remained the same in the major stores and in some cases has even gone up.”
Richard Kennedy, the Irish Farmers Association’s dairy chairman, said prices being paid to farmers were unsustainable and at 1983 levels. This was at a time when EU and world markets were recovering from oversupply and falling demand.
Dairy farmers, he said, were at the end of their tether and were looking at massive income losses this year. Co-ops must not cut their prices any lower.
Announcing the monthly price, Glanbia board chairman Liam Herlihy said there was no immediate upturn anticipated in coming months in world markets.
“We recognise that at this level milk price will be below the cost of production, and are aware of the difficulties this price presents for our producers and their families.
“The level of volatility experienced in dairy markets over the past number of months is untenable for all of us – milk suppliers and processors.”
He said the price set by Glanbia left the company’s milk-processing business in a potentially loss-making situation. “We have made, and continue to make, representations at local and EU governmental level for mechanisms to support the sector in this crisis.”