Newry & Armagh DUP Assemblyman and Stormont Agriculture Committee Chairman William Irwin MLA has welcomed an EFRA Committee recommendation that DEFRA seeks a commitment from Phil Hogan, the EU’s Agriculture Commissioner, to review the current intervention price for milk.
Earlier this week the committee outlined urgent key measures that must be taken to protect farmers who are facing ‘a dairy crisis’ with the volatility in the market set to continued.
Mr Irwin said the current intervention price stands at 17ppl which, given the current crisis and the actual costs of production, is ‘woefully inadequate’.
“I welcome the fact that the EFRA Committee has put forward this recommendation and it is important that DEFRA now follow this through and put as much pressure as possible on the Commissioner to deliver a review and uplift in the intervention price.
“I have read recent comments by the Commissioner who believes that the situation will stabilise in the latter half of the year and I know that many producers in Northern Ireland are certainly hoping for a swift recovery. In order to assist in this, intervention would be an important tool indeed in 2009 intervention worked well and when product was brought back on the market in a staged manner it was a success.”
He concluded: “It is important that DEFRA follows through on the directive of the committee and I will be interested to hear on the outcome of these approaches to the Commissioner. I also trust that Commissioner Hogan will fully recognise the difficulties producers are facing and whilst of course remaining optimistic of better days ahead, he must also be realistic of the real pressures in effect at this time.”
Meanwhile responding to the EFRA report the UFU said that many of the recommendations in the report are are not new to the UFU who met with Liz Truss, the Secretary of State for Environment, Food and Rural Affairs, in November 2014, to highlight the cash flow concerns being experienced by Northern Ireland dairy farmers and to put forward a number of proposals that would ensure a fairer, more sustainable dairy industry going forward.
UFU president Ian Marshall said: “We are all aware of the issues currently facing the dairy industry and of the implications for dairy farmers. Since April 2014 Northern Ireland has witnessed the base price for milk drop substantially from 32ppl in April to 21.50ppl in December. In addition Northern Ireland dairy farmers tend to see a drop in the price of milk before their GB counterparts due to its exposure to export markets, which sees NI export 85% of its milk.
“Back in November when I met with Mrs Truss, we called for a review of the EU intervention price for dairy products, she did not support our proposal, so we therefore welcome the recommendation put forward by the EFRA Committee to seek a commitment from the European Commission to review the intervention price for milk. This in effect would lessen the impact of negative price volatility when commodity markets drop again to an unsustainable level and would see farmers receiving a price that could reflect the actual cost of production. There is a meeting convened next week in Brussels, to review the EU Milk Package, which presents an ideal opportunity for the dairy industry to press for this review.
“I am also encouraged by the focus in EFRA’s report on the role of the Groceries Code Adjudicator. The UFU has always believed that the GCA’s remit should be extended to cover primary producers and that the GCA should have the power to launch investigations rather than just responding to complaints made.”
Mr Marshall continued: “At a local level, we have discussed a number of other proposals which could be utilised by farmers across all sectors, such as ‘capital holidays’ for long term farm business loans. We also have put forward proposals for the introduction of a Farm Management Deposit Scheme (FMD) to assist primary producers in dealing effectively with fluctuations in their farm business cash flows. Further options would be to extend income averaging from two-five years and also to open the debate on the use of hedging mechanisms in milk pricing, which could mitigate against price volatility. Finally, new export markets for NI dairy products and ensuring new product development and market research funding opportunities are utilised wherever possible is also crucial going forward.
“It is looking as if key commodity prices are bottoming out, but this does not relieve the hardship being felt on many dairy farms and in light of this, the UFU will continue in its efforts to lobby on behalf of our members to ensure that some if not all of these measures are put in place. This week, we will be meeting with a number of MLAs to discuss the dairy situation, increasing political pressure to get some of our proposed measures in place to ensure that our local dairy industry is able to nurture the long term prospects that await our sector.”