THE milk price reductions seen so far in 2023 will wipe €2 billion from dairy farmers’ revenues, in turn seeing reduced spending in rural communities by possibly double that amount.
Figures released by the ICMSA show that milk revenue in Mayo in 2022 amounted to €61,414,000. It has fallen to €37,415,000 this year – a difference of €23,999,000.
Spending power within the sector has dramatically deteriorated. From concrete to shed suppliers, and milking equipment to farm machinery, the reports coming back is that dairy farmers have stopped buying and investing, with only the very basics being purchased, and this is going to have a dramatic impact on the local economy.
The ICMSA has carried out a detailed analysis of each of the 26 counties to establish the reduction in revenues earned by dairy farmers over the last two years. Results show the dramatic drops in milk values, with almost €2 billion less expected to be paid to dairy farmers in 2023 versus 2022.
The analysis, Mr. McCormack said, used an average milk price of 59cpl for 2022 and an expected average price of 37cpl for 2023, with production expected to fall by 2% year on year given the weather and price conditions prevailing at present. This means that almost 38% of dairy revenues have been wiped away in the space of 12 months and this analysis does not include the very severe cost elements facing dairy farmers, meaning that dairy farm incomes will be severely hit in 2023.
While fertiliser has reduced somewhat, most fertiliser was purchased early in the year or last year at inflated prices and, unfortunately, electricity and feed remain stubbornly high.
Mr. McCormack said that the milk price reductions have been very severe and will have a massive impact on dairy farmer income in 2023 and he called on the Minister for Agriculture to immediately convene a meeting of the dairy forum so that a clear strategy can be put in place to kickstart an immediate recovery in milk price which is needed by the farmers who produce the milk on a daily basis but also the wider rural businesses that are dependent on it for their revenues.
