The cuts in milk price announced since the start of the year are “absolutely horrendous” and are a hammer blow to dairy farmers, the president of the Irish Creamery Milk Suppliers Association (ICMSA) has said.

Lakeland Dairies announced a second consecutive 6c/l cut in milk price on Monday.

Pat McCormack said that for a farmer supplying 400,000 litres to Lakelands, the drop in revenue for 2023 will be of the order of €48,000.

He said this cut in income is unsustainable and he called on co-op boards to “steady the ship” on milk price.

McCormack noted that this latest cut in milk price came against a background of continuing food inflation at national and EU level, with milk, butter and cheese all continuing to rise at retail level.

Simple question

He said that a very simple question now arose: if consumers across the EU and UK are still paying more for food - including milk, butter and cheese - and with the bulk of Irish dairy exports going to the EU and UK, exactly how do we arrive at cuts in the prices paid to the farmers?

Was this, he asked, another example of margin-grabbing and “soft selling” at the expense of farmers?

Hard questions

The ICMSA farm leader said that farmers understand the dynamics and challenges of the marketplace as well as anybody, but the contrast between the still rising prices paid by consumers and the falling price paid to the farmer means that hard questions need to be asked and answered.

“The very first question being where along the line has the 12c/l lost by Lakeland suppliers since the start of the year gone? Who has taken this margin?

“Everyone must remember that input costs have not come back to realistic levels, with particularly Irish fertiliser prices way out of kilter with the EU.

"Electricity and energy prices are still at unacceptably high levels for small businesses like farmers and interest rates continue to increase,” he said.

He said it is essential that co-op boards put in place an immediate strategy to bring farm input costs, such as feed and fertiliser, back to realistic levels.