New National Milk Agency chair Jackie Cahill has said that his view is that any milk purchased in the Republic of Ireland should be under the agency’s remit.

At a meeting of the Joint Oireachtas Committee on Agriculture last Wednesday, Cahill said that the agency is currently looking at covering contracts for milk collected in the Republic and processed in Northern Ireland.

“At the moment, that milk is considered as Northern Ireland milk”, he stated.

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“Strathroy are purchasing more and more milk in the south,” he said, which the agency will look at covering going forward, as it is currently not in its remit.

Liquid milk sector

National Milk Agency CEO Muiris Ó Céidigh spoke at the meeting about concerns for the future of the liquid milk sector in Ireland due to milk prices going down and input costs going up, which is increasing pressure on these farmers.

He said that the number of liquid milk producers in Ireland in 2020 was 1,300 and now it has reduced to just over 1,000.

Ó Céidigh said that the price of milk in supermarkets has dropped by 10c in the past few months and the price being paid to farmers has decreased, while input costs such as feed, fertiliser, energy and labour are all increasing, making it unsustainable going forward.

Cahill said: “The price that liquid milk farmers are receiving at the moment is going to make it very difficult for those farmers to continue.

“The agency do not have the remit to increase the price of milk, but only to ensure adequate compensation for farmers through their contracts,” he stated.

Concerns about adequate domestic supply of liquid milk in Ireland were raised by the committee, to which Cahill replied: “We have managed to always have adequate liquid milk supplies in the country, but just because we always had does not mean we can take it for granted.”

In terms of fixed milk contracts, Cahill stated “it will not be on the cards”.

Generational renewal

Ó Céidigh said another major issue for the liquid milk industry is successors for the future.

He spoke on how the sector does not provide an attractive package for young people, as it has unsocial hours due to milking all year, retail and processor prices are down and input costs are up.

He also mentioned that young dairy farmers might see it easier to do manufacturing only milk production, as cows are dried off for a period of the year which provides them with a break.

Speaking on generational renewal, Cahill said he thinks it’s simple: “If the returns are there, young people will stay producing liquid milk, if it’s not they will walk away from it.”

He also said the sector has become too bureaucratic in terms of derogation and nitrates rules.

Agri-Food Regulator

When questioned if the agency would be working with the Agri-Food Regulator, Cahill said that they will be organising a meeting very soon with the regulator to discuss where the industry is at currently.

Cahill said there is huge pressure on the producer at the moment and that the regulator will have to examine retailers lowering the price of milk.

“Retailers have a responsibility here too, everyone across the food chain has to get a margin,” he commented.

The CEO stated: “In terms of what the National Milk Agency does, we do not have much of a direct interaction with retailers.

“Everybody knows what the producer gets paid by the processor, everybody knows what the retailer gets paid by the consumer, but the box in the middle is what the retailer pays the processor.”

He said that the agency wants to know what value the milk producer is receiving in this chain which will be the job of the Agri-Food Regulator.