President Healy, the IFA, and many milk suppliers were joined in arms today, protesting against a so-called market grabbing milk price war.
Farmers have become increasingly concerned that retailers such as Dunnes Stores and Aldi are offering milk at discount prices, of 67 cents per litre. They say this will undermine the sustainability of Ireland’s fresh milk producers. This week Aldi joined Dunne stores in offering milk at lower prices, which led to the resulting protest outside their stores.
President of the IFA, Joe Healy, says these producers depend on the guarantee of a reasonable income from supplying milk. He added that this is recognised in Europe, with a new draft legislation on the equity of the food chain due next year.
“Specialist liquid milk producers, like all primary producers of fresh food, depend on being able to make a reasonable income from the retail chain. This is something that is being recognised in Europe, with draft legislation on equity in the food chain expected next year, and French retailers currently agreeing to pass back increased wholesale prices to farmers,”said Joe.
He added that with the high costs incurred by farmer, that there is no such thing as cheap milk. He continued by stating that farmers are the ones who fare worse from these market “grabs” by retailers.
“There is no such thing as cheap milk. Fresh milk producers incur high costs and legitimately expect to be able to cover their costs and make a reasonable income from their specialist milk production. Yet, experience tells us that farmers always come out the worst of these cynical grabs for market share by retailers. Any apparent benefit for consumers is short-lived, with the security of year-round, local supplies of milk from freshly calved cows being threatened by the erosion of margins in the chain,” Healy said.
John Finn, Chairman of the IFA National Liquid Milk Committee, said they have held meetings with retailers to discuss the Milk Wise 2025 Strategy. This is in order to protect the sustainability of fresh milk production in the best interest of Irish consumers.
“While they asserted their commitment to sustainability of supplies in our discussions, it is clear that Dunnes’ and Aldi’s actions do not match their words. They are devaluing our milk, potentially setting off a downward spiral in prices which farmers will, as usual, end up paying for.”, said Mr. Finn.
He then called on the aforementioned retailers to resist the race to lower milk prices and called on Irish Dairies to resist this pressure, he described as “bullying”.
“I call upon Dunnes Stores, Aldi and all retailers in Ireland to desist immediately from the race to the bottom on retail milk prices. I also call on dairies to resist the bullying pressures from retailers to undercut one-another in a value-sapping, perverse, market logic which can only lead to falling producer prices and fresh winter milk shortages for consumers,” he said
IFA President Joe Healy concluded by calling for retailers and dairies to follow the path taken by their French counterparts. The French government commit to paying an increased price to farmers, to help cover costs and ensure they can make a decent living. Healy said this approach is the only way of providing sustainable milk production in the future.
“Instead of these short term, ill-thought out tactics, dairies and retailers should take a leaf out of their French counterparts’ book, by making a public commitment to pay an increased price within the chain that allows for farmers to make a reasonable living, cover their costs and pay themselves a modest wage. Only this type of approach will secure the sustainably of locally produced, high quality fresh milk for Irish consumers for the long term”, he concluded.