Dairygold co-op is offering members a phased super levy payment scheme to help its suppliers with potential super levy bills expected after this year’s very strong milk production.

The proposed scheme will operate by milk suppliers paying 15 cent of the total super levy penalty of 28.65 c/l by April 2015, with the balance being collected in ten equal instalments over two years between May and September 2015 and 2016.

Dairygold chief executive Jim Woulfe said: “Ireland is currently facing its largest ever super levy bill in its final quota year 2014/15. Dairygold is currently 9.4% over quota. So it seems inevitable at this stage that we will incur a super levy penalty next year.”

He added that a large super levy penalty could place a high cost burden on milk suppliers in the last year of the milk quota regime and put a strain on their cashflow at a time when it is most needed.

“Therefore, we are offering our members the option to spread the repayment over three years. We believe it is innovative and attractive to suppliers and will ease the cashflow demand on our members and facilitate a smoother transition from the quota era to the post-quota era.”

The scheme is optional and Dairygold suppliers will need to sign up to avail of the offer. Dairygold will pay the super levy payment in full on behalf of its milk suppliers to the Department of Agriculture when it falls due.

Dairy farmers need to have a clear understanding of their production costs before deciding to continue delivering over quota milk next spring for what will probably be a very low net price once superlevy is paid.