At the end of March 2022, NI’s largest milk processing co-op, Lakeland Dairies, announced that it was imposing a new five-year milk supply management scheme in 2023, which involved a 3p/l deduction on “new milk” supplied during the peak months of April to June.

That decision was based on survey results from suppliers, with most indicating an intention to continue increasing production in the years ahead. As a result, extra processing capacity would be required, and the scheme from Lakeland was a signal to suppliers that this new steel comes at a cost.

But in the four months since then, the landscape has fundamentally changed, and perhaps it is questionable whether the Lakeland scheme will ever come to fruition.

Already we have seen milk production in NI during 2022 start to tail off, and with lots of poor-quality first-cut silage on farms, coupled with high feed costs, and much uncertainty around future fertiliser markets, it all points to supply being under pressure in the next 12 months.

Some farmers will continue to expand, while new entrants will still come forward, but this new milk might simply replace that lost as others retire out of the industry.

And if other processors see their volumes coming under pressure, the obvious thing to do would be to approach Lakeland suppliers.

Reports suggest that a couple of Lakeland suppliers recently moved to Dale Farm.

While Lakeland still has this scheme in place, it really isn’t in much of a position to respond.

But of course, many of the reasons why supply might come under pressure in the next year are short term.

Long term

Longer term, is it greenhouse gas emission targets and other environmental challenges that will dictate farm output.

In the Republic of Ireland, a new legal target to take 25% off emissions by 2030 will be extremely difficult to achieve without cutting livestock numbers.

It would be delusional to think that NI won’t face similar targets in the years ahead. The days of industry expansion look to be over.

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