The Irish Farmers' Association (IFA) has called on retailers to return an additional 7c/L to fresh milk farmers this winter to help offset rising input costs. The farm organisation also urged grocers to stock farmer-owned dairy brands and encouraged consumers to look for milk bearing the National Dairy Council logo.
According to the IFA, producing a year-round supply of fresh milk requires extra labour and incurs substantial additional costs. It warned that fresh milk farmers are facing higher costs while the farmgate price for milk remains low.
Henry Dunne, the organisation's liquid milk chair, said processors' premiums for liquid milk production have been eroded by the considerable decline in the base milk price over the past two years. He said the IFA is seeking "a fairer share of the existing retail price".
Seven milk processors handle the majority of Ireland's fresh milk and pay a premium above the standard manufacturing milk price, according to the organisation. It said five major supermarket retailers dominate the grocery market, with a combined share of 94%.
The IFA estimated that around 70% of retail fresh milk sales are now private label, sold at an average discount of about 15% compared with farmer-owned brands. Private-label milk sells at a lower price than branded milk, it added.
It said persistent pressure to cut prices has squeezed margins for fresh milk producers to the point that there are now 66% fewer producers (1,094) than in 1995 (3,344).
The organisation has called on the National Milk Agency to ensure fresh milk farmers are adequately compensated, and on the Agri-Food Regulator to bring transparency to producer, processor and retailer margins. The National Milk Agency was established under the Milk (Regulation of Supply) Act 1994 to regulate the supply of milk for liquid consumption throughout the state.