The decision of a number of milk processors to cut the July milk price is extremely disappointing for farmers and ICMSA is concerned that milk price decisions took too much account of dairy product price movements in August as August price movements are generally out of sync with other periods and should not be used as an indicator of milk price movements, according to Mr. Pat McCormack, Deputy President and Chairperson of ICMSA’s Dairy Committee.
The reductions in milk price since the start of the summer are of huge concern to dairy farmers and along with superlevy concerns, will have a major negative impact on farm incomes this year. While dairy markets have weakened, ICMSA is clearly stating that too much should not be read into price movements at present. August is the traditional holiday period and this is no different in the dairy markets with buyers and sellers on holidays and this typically as would be expected have a negative impact on the marketplace. While recent auctions in the Global Dairy Trade have seen markets soften, it is expected that buyers who have been away from the market will return in the coming months and secondly, the northern hemisphere is also well past its peak milk production period.
Peak production in Europe, our main market for dairy products, has well passed which should ease some pressure on prices and it is now wait and see how production in New Zealand and the Southern Hemisphere fares in the coming months. Milk production in these regions will clearly have a major impact on milk price as we head into 2015.
While there are a number of negatives in dairy markets at present, there are also plenty of positives at present including increased butter usage and the continued demand increases year on year for dairy products in developing countries. In addition, our dairy processors and the Irish Dairy Board have invested heavily in value added and routes to market and dairy farmers can rightly expect that these investments will deliver for farmers should the market come under pressure in the coming months, concluded Mr. McCormack.
Ends. 19 August 2014
Pat McCormack, 087-7608958
Deputy President, ICMSA