UFU president Ian Marshall has described the outworking of this week’s crisis dairy meeting in Belfast as an opportunity for all parties concerned to take stock of the challenges that lie ahead for dairy farmers.
Marshall also said that the outlook for dairy prices over the coming months looks bleak.
“The value of milk currently equates to 15-16p/L.
“This is totally unsustainable. And there is no realistic prospect of a short-term improvement locally or globally.”
According to Marshall, there was agreement reached on two key issues.
“The first of these is the current cash flow crisis on farms and the need to alleviate these short-term financial concerns.
“Secondly, there is a need need for a wider debate on a longer-term strategic approach to managing volatility and the challenges for the dairy industry that flow from it.
“Everyone around the table was acutely aware of the stark reality that the level of borrowing across agriculture as a whole has increased significantly across all sectors. It now totals £996m, that’s up £67m from the previous year.
“There was also acknowledgement of the huge diversity in current farm circumstances.
“This reflects investment, level of borrowing, maturity of business and the existence of other revenue streams.
“This did not, however, take away from the fact that a large number of businesses are under huge financial stress with no sign of recovery on the horizon.”
According to Marshall, the most significant outcome form the meeting was the recognition that the financial climate for agriculture had become more difficult over recent months.
“There is no single solution to these problems,” he said.
“The UFU believes it will take all involved to be more radical in their thinking in order to tackle the current financial issues and the longer term volatility challenge that confront farmers.”
The meeting was chaired by the north’s Minister for Agriculture Michelle O’Neill.
She said that she will continue to press EU Commissioner Phil Hogan to ensure that all available mechanisms at his disposal are effectively deployed to benefit the local dairy sector.
“Our financial institutions are also key to supporting farmers in managing their immediate cash flow difficulties and I will follow up today’s meeting by communicating with the individual banks and finance companies too.
“Government has a part to play but solutions lie in the hands of industry and can only be achieved successfully if everyone in the dairy supply chain collaborates and works together, with the same vision and an agreed strategy to achieve it.
“We, therefore, need consensus to addresses issues such as cash flow on farms and the current over-supply of milk coming from farms.”
The Minister pointed out that the Agri Food Strategy Board and Supply Chain Forum have been established to deal with industry challenges and to develop workable solutions.
“This model of industry collaboration has already worked very well to deliver a project on livestock genetics improvement. I encouraged all those represented today to come together within that framework to progress this very important work on behalf of the local dairy sector.”
She said she has asked her officials to work with representatives to establish a dedicated working group under the existing structures, with a specific remit of addressing the issues facing the dairy sector right now.
“It is important that the Department of Agriculture plays its role and my commitment to supporting our farmers is undiminished. I will continue to lobby on their behalf in Brussels, Dublin and London.”
