Dairy prices continue to fall – ICMSA calls for “immediate introduction” of EU-wide Voluntary Milk Supply Reduction Scheme
In light of the milk price announcements in recent days that mean that Irish dairy farmers will be producing milk below the cost of production for the foreseeable future, ICMSA President, Denis Drennan, has called for the EU Commission to immediately introduce a EU-wide Voluntary Milk Supply Reduction Scheme that will reduce supply coming onto markets in a way that’s proven to “put a floor under” falling farmer milk price. Mr Drennan said that we such voluntary scheme was a ‘tried and tested’ method that had previously worked in very similar circumstances and would provide badly needed support for farmer primary-producers in Ireland and right across the EU as we face into the critical late-Spring/early Summer ‘Peak Production’ period.
“With global supplies up 2.3% between January-November 2025 compared to -0.1% between January-November 2024 period, it’s very obvious that the global market is currently oversupplied. The market has probably over-corrected, but – as usual -the only person paying the price for this market turbulence is the dairy farmer. No-one else in the dairy sector, whether personally or as a business, is taking the kind of financial ‘hit’ that results from a milk price falling from over 50 cents per litre to below 33 cents per litre in some cases. We have to be blunt here and we’ve heard a lot in recent days about the Government’s commitment to Irish farming, but this is where that needs to translate to action: these kinds of price and income falls are not sustainable and are steadily undermining the farmer ‘link’ in our multi-billion Euro dairy sector. No-one or no other part of the sector is losing so much as a cent; it’s the farmer who’s taking the ‘hit’ for the whole sector with everyone else using the farmer’s ‘wipeout’ as the equivalent of a ‘Reset’ button for the whole sector. Everyone along the supply chain benefits from a market upturn, but only the farmer suffers from a market downturn. It’s so obvious and it must be addressed”, said Mr. Drennan.
Mr. Drennan said that the EU Commission and our own Government “were never done” preaching about the need for sustainability at farm level. To deliver sustainable prices, global milk supplies need to come down, and the EU had the perfect mechanism to ensure that that happened.
“The over-supply is global, but the EU can – and should – be fixing what’s within its own power to fix; it should be doing what it can do ‘inside its own gate’. In 2016, the EU introduced an EU-wide Voluntary Reduction Scheme which provided a payment to individual farmers to voluntarily cut their milk supplies for a specified period. The scheme worked almost immediately by changing market sentiment and, critically, it provided dairy farmers with an option of either producing more, the same, or less milk in a market downturn. It was called for by ICMSA and the EMB, the ‘umbrella’ group for EU dairy farmers organisations, and it turned the situation around almost instantly. The key was allowing farmers to make the decision for themselves because they know better than anyone their individual circumstances. We did this in 2016 and a decade later, we need to do it immediately and certainly well before ‘Peak Production’ looms up in front of us”, said Mr. Drennan.
The ICMSA President said that the proposal would “doubtless” be opposed by some elements. But those objecting were obliged to propose their own solutions and “just waiting around” for the market to turn up of its own accord was going to inflict massive and possibly irreversible damage on the most valuable sector of Irish agri exports.
“The essential point here is that support would have to be given at some stage and in some fashion and this Voluntary Reduction Scheme had the merit of being practical, applicable at individual farm level and proven to ‘put a price floor’ under a falling market. EMB (European Milk Board) is strongly advocating this solution to what is rapidly becoming a market collapse and the Irish Government should throw its full weight behind an easy and affordable solution that will restore market balance in a speedy and transparent way”, said Mr. Drennan.
Ends 14 January 2026
Denis Drennan, 086-8389401
President, ICMSA
Or
Cathal MacCarthy, 087-6168758
ICMSA Press Office
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