Jun 23rd, 2009

Cahill attends Luxembourg farm protest but says intervention alone will not solve dairy income collapse

Speaking after returning from the farmer protest in Luxembourg, Jackie Cahill, the President of ICMSA, said that the idea that even the most extensive form of intervention could provide a permanent solution to the dairy crisis in the EU was profoundly mistaken and still left unresolved the reality of a structural surplus in EU milk production.

Mr Cahill, whose stature as a one of the country's leading dairy experts is now growing by the day, enjoys a reputation as a man who'll 'call it as he sees it' and he repeated his conviction that intervention, supports and refunds must be deployed in the short term to support present milk prices, which he described as catastrophic. But the straight-talking farm leader said that the only viable solution was an end to the policy of expanding quota and producing more milk to be sold on a market where the price had already collapsed. The solution to the collapse in milk price was the solution that would be applied to any other commodity, namely, a form of supply-management that would regulate the supply of milk going to market till such time as demand started forcing the price upwards. Mr Cahill said that it was basically impossible and contradictory to support quota expansion and simultaneously ask for greater support and the situation was too critical for anybody to pretend that such a policy was feasible. The ICMSA President said momentum right throughout the dairy sector was now swinging behind his association's policy of a flexible supply-management system that would allow farmers to react and produce more milk when prices were strong but would equally allow them to regulate supply quickly when prices turned and fell. The present situation, where farmers were effectively losing money on a daily basis and facing into a prolonged period with no income whatsoever at the same time as many were expected to service loans that the Government had insisted they take out to meet the infrastructure requirements of the Nitrates Directive, would bankrupt huge numbers in a sector that could potentially play a massive role in any export-orientated national economic recovery.

"I know so many dairy farmers right throughout the country who now realize that the policy of continued quota expansion at a time of price collapse is actually compounding the disaster. It's actually making a bad situation catastrophic and we have to start being logical about how we manage the supply of milk going on the market. We should have learned our lessons about what happens when you completely abandon the regulation of a market – look at our property and banking sectors for the proof! ICMSA is right about the need to manage the supply of milk so as to ensure that the dairy farmers get an income commensurate with their hard work and expertise. More and more farmers throughout Ireland, are seeing the logic and the stability behind our argument, which is shared by our sister farm organisations all across the EU that have come together to form the European Milk Board. Dairy farmers need a specialist Europe-wide association and ICMSA's role in the European Milk Board is providing just that", concluded Jackie Cahill.

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