15 March 2016
By David O’Sullivan
Cork South-West Fianna Fáil TD Margaret Murphy O’Mahony has said milk supply controls from Europe have the potential to seriously impact on farmers in west Cork.
France has been pushing heavily for the European Commission to introduce such supply management measures to deal with current dairy price volatility.
Deputy Murphy O’Mahony said: “From an Irish perspective, bringing in such milk supply controls, even though they’re voluntary, represents a dangerous precedent in compensating for reduced production.
“Firstly, Ireland is heavily dependent on exporting dairy product to global markets. 90% of all milk produced in Ireland is exported. Ireland produces about 5.5 billion litres of milk per year; while in 2015 total dairy exports were worth in the region of €4 billion in value.
“Such supply measures in Europe do not make sense as it will leave other non-EU countries free to produce and enhance market share. While the measures are beneficial for France with an internal market of over 60 million people, this will hit exporting countries like Ireland, especially our capacity to take advantage when an upturn in the market takes place.
“What is more, the world market for dairy increases by 15 billion litres every year, almost 3 times our total annual production.
“Secondly, these voluntary measures are just the thin end of the wedge. It will not be difficult to transition them to a compulsory nature if the market deteriorates further in the immediate short term. Europe has taken the wrong decision here and this could seriously impact on the earning power of farmers in west Cork and across the country. A worst case scenario would see Irish farmers’ penalised through a levy for increased production to compensate continental European farmers for reduced milk production.
“We need to see a review of price intervention tools in the dairy sector in order to deal with the current market volatility and low prices crippling dairy farmers. The essential floor for support should be increased from 21 cent to the cost of production per litre to the average EU production cost.”