‘Milk supply drop costs rural Ireland €370m in just four months’

It comes as the CSO last week reported another fall in April milk production, down 81 million litres (-7.9pc) when compared with April 2023 and down 107.6 million litres (-10.2pc) when compared with the same month in 2022.

It means, for the period January to April 2024, the Milk Intake by co-ops and processors is now at 2,204.6 million litres, a decline of 186.3 million litres (-7.8pc). Dairy Industry Ireland (DII) has estimated that this equates to a direct loss of milk sales by dairy farmers this year of €75-85m.

However, speaking to the Farming Independent, DII director Conor Mulvihill warned the loss to rural Ireland is much greater, highlighting what he described as the ‘multiplier effect’ of the dairy industry in rural areas.

He said that based on EY research conducted by the industry, this year’s lost production has taken some €370m from the rural economy.

​“This money has not been taken from cities, it is coming out of rural Ireland,” he said. “We are talking about a loss the equivalent of three Páirc Uí Chaoimh in just four months, and this is on the back of an over 4pc loss in milk supply last year as well.”

Meanwhile, IFA dairy chair Stephen Arthur called on milk processors to increase the price paid to their dairy farmers to compensate for the lost supplies.

“Milk volumes continue to lag well behind 2023 levels which means reduced sales for dairy farmers,” he said. “Together with the increased cost of production from the very difficult spring, dairy farmers need to be paid for their product and we believe the market can support a price increase.”

He also said markets are improving, with the GDT this week showing an improvement of 1.7pc on the last trade two weeks ago. Butter is trading at almost €7,000 per tonne, up 1.7pc and skim is up 3pc at €2,722 per tonne.

“Ornua’s PPI return for May is 39.6 c/l, VAT inclusive, which is an increase of 1.1 c/l from the previous month, with the Ornua value payment worth an estimated additional 2.97 c/l including VAT. This price represents an increase on Ornua’s PPI return of 4.93c/l since January of this year.”