Commenting on the data contained in the Teagasc National Farm Survey for 2016, the President of ICMSA said that the 9% fall in farmer income was stark enough but the 17% fall in dairy farmer income was as bad as had been predicted by ICMSA and would certainly have been worse had the EU not introduced the EU Voluntary Reduction Scheme in 2016. Mr. John Comer said that the collapse in milk price through 2015 and the first half of 2016 had destroyed farmer incomes in this most crucial agri-sector and, importantly, the survey shows that farmers invested €100m less in 2016 with direct negative impacts on the wider rural economy. He noted that the dairy sector was not alone in this regard with the tillage sector also negatively impacted by volatile markets.
“Income volatility, as repeatedly highlighted by ICMSA, is one of the major challenges for the farming sector and today’s figures – though widely anticipated – must compel the Government to demand of the Commission that we move away from the boom/bust model of food markets with its wild volatility and total incompatibility with commercial planning and farm stability. When there’s a boom, farmers don’t get the full returns and when there’s a bust, we take the full hit”, said the ICMSA President.
Mr. Comer said it was impossible for family dairy farms to develop on a basis that could see their income surge or collapse by 20% to 30% in a two-year period and he called on the Irish Government to grasp the central message of these figures which was that some degree of stability and predictability simply had to be introduced into food markets. The ICMSA President noted, for instance, that the introduction last Autumn of the Voluntary Supply Reduction Scheme had an immediate stabilising effect as it signalled to the market that supply and demand would start moving towards a balance and the milk price recovery started in earnest from that point. Mr. Comer said that a useful start towards eliminating this completely destructive boom/bust price cycle would be the incorporation into the Commission’s agri ‘Toolbox’ of this supply reduction mechanism as a permanent policy tool to be deployed in the event of farmers’ price falling below a certain level for a certain period. One thing was for absolute certain, noted the ICMSA President, no other group in Ireland would even be asked to contemplate a scenario where their income could collapse by nearly 20% in a single year and be expected to just shrug their shoulders and carry on.
He concluded by stating that Brexit is an additional serious threat to the Agri-food sector and we need to see initiatives in Budget 2018 that will allow farmers to plan for the threats of Brexit. There has been a huge focus on Brexit but to-date no specific actions have been taken to protect individual sectors like farming and it was time to start framing real responses.
Ends 31 May 2017.
John Comer, 087-2057846
Cathal MacCarthy, 087-6168758
ICMSA Press Office