The Cork-based farmer with farms in New Zealand and the US said a reduction in global supply will drive up prices, for at least the next two years.

“Coupled with lower supply, increased demand, particularly in China and equally in the US, are very helpful. The only snag I see is that with very cheap oil and feed in the US, it will continue to grow at at least 2%. If it grows by 3% it is likely to bring the market down a wee bit,” Murphy said.

Listen to Looking forward to the Positive Farmers Conference on Spreaker.

ADVERTISEMENT

Speaking about president-elect Donald Trump, he says that any short-term stimulus to the US economy will be good for Ireland, but the risk with Trump is that he is against free trade.

“It would be very bad for Ireland and bad for Irish agriculture if there is less free trade,” Murphy said.

Water shortages

He said the long-term prospects for Irish dairy farming are very positive, citing future water shortages across the world as a looming crisis.

“Water-rich areas like Ireland will get a huge boost to relative competitive advantage when water shortages start to kick in across the globe.”

Murphy was speaking ahead of this year’s Positive Farmers Conference, which takes place in the Radisson Blu Hotel in Cork on Wednesday 11 and Thursday 12 January.

Read more

Dairy trends: GDT starts 2017 on downward note