Union anger at Northern Ireland milk prices

18-Oct-2016 - Last updated on 22-Dec-2016 at 11:46 GMT

While dairy prices might be on the rise, the Ulster Farmers' Union says it is unhappy those increases aren't making their way to farmers.

Ulster Farmers’ Union (UFU) president, Barclay Bell, says dairy farmers in Northern Ireland are frustrated and angry at what he says is the derisory milk price increase delivered by local processors.

Bell says they are lagging behind their counterparts in Ireland and in Great Britain.

Last week, UFU dairy chairman, William Irvine, said dairy processors must take steps to maximize returns to dairy farmers. He said that despite better markets, thanks to the weakening of sterling, most dairy farmers were still living with a milk price well below the true cost of production.

Move to hostility

Bell said the UFU believed processors had taken this message on board, but he was disappointed with what was delivered.

“We have attempted to work with them for the good of the industry,” Bell said.

“But I think our approach now needs to be more hostile and critical. It is clear the interests of farmers are well down their list of priorities.”

He noted that dairy cooperatives in Ireland are responding more positively to events on global markets, adding that prices are also rising sharply in Great Britain – and said that some processors in Northern Ireland are buying milk cheaply from local farmers and selling it on a booming spot market for up to 35 pence (43 cents) a liter.

Price calculation

The UFU carries out its own regular calculation of what the milk price should be, based on market returns and currency rates.

Bell said the index is pointing to a minimum price increase of two pence a liter, when processors and delivering just about half that.

Prices going up

“Farmers in Northern Ireland are well aware that prices for cheese, butter and milk powder have moved upwards over recent weeks,” he noted.

Dairy commodity price increases began in late May. Since then the GDT price has risen by 20% and the Dutch Dairy Board (Zuivel) butter price is up 60% from its low.

Processors must act

Irvine said that despite these gains the DAERA (Department of Agriculture, Environment and Rural Affairs) average for August was 19.77 pence (24.3 cents) per liter.

“There is no question that this is lagging well behind what the market is returning,” Irvine said.

“There are more price increases to come but processors need to act more rapidly if they want to guarantee a future supply of milk.”