Jul 29th, 2009

Minister Smith focused on flawed arguments in Ireland - while he loses the argument for Ireland in Brussels

The statement by Minister Brendan Smith today stating boldly that it is was flawed argument to suggest that the crisis in the dairy sector is due to EU quota increases as EU production is already under quotas. “So what Minister - who is putting forward this argument? It is your policy which is manifestly flawed and has been proven to be so” stated Mr. Jackie Cahill, President ICMSA.

“The reality is that EU milk production is increasing at a time when consumption is falling. The resultant market imbalance has caused the biggest crisis in the dairy sector ever. The crisis is due to extra milk production in the face of falling demand, resulting in falling milk prices to farmers which in turn has forced farmers to produce even more milk. This vicious cycle is facilitated and magnified by quota increases.

What then are the facts which the Minister and his Department are either unaware of or are suppressing in an attempt to cover up their own flawed policy which we have already said is bankrupting dairy farmers. These are the facts”, continued Mr. Jackie Cahill.

“EU production in the first two months of the current quota year to end of May was one per cent up on the same period of 2008 and even given the high level of milk production in 2007, this 2009 production was 0.7% over the same period in 2007. Production in ten Member States has increased this year. Here is the paradox- which is damming factual evidence and an indictment of the Minister’s flawed policy- Ireland experienced the actual biggest actual volume fall (excluding France which is a special case due to a once-off adjustment). The decline in Irish milk output has actually deepened in the months of June and July to-date.

Minister- face these facts. The evidence is clear for all to assess. You claim that your policy is to bring about an expansion in Irish milk output. The reality on the ground is that production is actually falling and falling at least as rapidly, if not more so, in Ireland than in other EU countries. Dairy farmers now expect you to stop the nonsense of press release talking about entirely flawed arguments and to set about winning the argument in Brussels to get a milk price increase that can be sustained. We recently detailed our policy directly to you and the Taoiseach. Your approach and your attempt to justify a lost argument are luxuries we cannot afford. It is we that are facing the cuts and possible bankruptcy”, concluded Mr. Cahill.

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