The IFA’s National Liquid Milk Committee Chairman John Finn talks us through their Milk Wise 2025 strategy.
In April 2016, The IFA National Liquid Milk Committee elected Galway dairy farmer John Finn to succeed Teddy Cashman as their Chairman for four years.
John milks 150 cows near Oranmore with his wife Joan and son Eavan, who is currently abroad in New Zealand. He was Chairman of the Arrabawn Liquid Milk Producer Group between 2004 and 2014, and in this position was involved in price negotiations with Arrabawn on behalf of fellow-producers.
At the time of his election, he outlined his main objective: “I want to lead milk producer groups from all around the country in a united fight to ensure cut-throat competition between dairies and retailers is not allowed to erode the milk price that specialist farmers need to remunerate their higher production costs”.
Almost 12 months into the job, back in late March, John launched the IFA Milk Wise 2025 strategy along with IFA President Joe Healy and its introduction states: ‘to secure long term availability of fresh, high quality, locally produced milk, including over the winter months, the sector now needs to define a road map to keep committed specialised producers viable’.
There is a real risk of shortages for consumers because farmers aren’t being paid enough to milk cows during the winter.
90% of Ireland’s dairy farmers produce milk on a seasonal basis for commodities, mainly for export. Fresh milk for the supermarket shelf is produced 365 days a year by 1,800 specialists among our 18,000 dairy farmers. Traditionally, there has been a price premium for farmers who milk all year round, but their margin has been eroded in recent years.
Pressures on supplies could be exacerbated by the Brexit process so the IFA has come forward with a strong strategy to keep local milk that is valued by Irish consumers on supermarket shelves.
John Finn stated: “When I started in liquid milk production in 1984, it was a profitable farming enterprise, with brands dominating the market and the largest volumes sold door to door.
“Things have changed. Supermarket private labels sourced through price-based tenders now dominate sales. The cut-throat competition for market share between dairies and retailers has eroded margins to unsustainable levels.”
From a retail regulation point of view, John argues that the time has come to put an end to the one-year tenders favoured by main retailers.
“These make for dysfunctional commercial relations and result in wild swings in supply arrangements, which neither farmers nor dairies can cope with. I am challenging dairies and retailers to show greater creative, and provide multi-annual fixed price contracts similar to those offered by co-ops for creamery milk destined for export.
“We also believe that our retail regulations need to be revised to return to the prohibition of below cost selling, and to provide for a well-resourced and independent Ombudsman to stamp out unfair trading practices and secure a sustainable margin for primary producers,” he added.
“We propose to first establish a base line through a profiling survey of the 1,800 specialist producers, their ages, their succession plans and their intentions. Autumn dairy calf births fell 15% in 2015 and 11% in 2016. It is clear that we have reached the point where shortages of fresh milk will occur in winter.
“The National Milk Agency has already agreed with our proposal, and the survey is to be carried out this year. We also believe farmers’ contracts need to be reviewed to offer greater fairness and transparency in pricing, multi annual commitments, and better visibility on winter prices before signature,” he said.
“We have made a number of recommendations regarding the specific regulation of liquid milk by the National Milk Agency. Most of these are already being progressed in co-operation with the NMA.
“We believe it must be empowered to collect and disseminate data on milk imports, and must together with Teagasc, develop and maintain an Observatory of input costs. This must be a tool in fulfilling the NMA’s mission under the Milk Supply Act 1994 to secure adequate compensation for farmers over the winter months.
“Current guidelines used for this assessment consider that, while the milk is supplied, adequate compensation is duly paid. This does not allow anticipating the type of looming shortages we are seeing at the moment. The assessment of ‘adequate compensation’ must be made on the basis of robust economic analysis of the profitability of liquid milk production.”
Following on from the launch, John and Joe Healy presented Milk Wise 2025 to Minister for Agriculture Michael Creed. Challenging dairy, retailers, other industry stakeholders and Government, he urged all to support its strategy.
Equally renowned for his involvement with his basketball as the farming sector, John’s name is synonymous with the Maree Basketball club. He was recognised with the Men’s Division One Coach of the Year accolade in 2016 and also serves as Assistant Coach with the Ireland U18 Mens team.
Despite the heavy workload, he is enjoying his time heading up The National Liquid Milk Committee and is determined to make a success of his four year tenure by helping to secure the long term futures of Ireland’s liquid milk sector.
John Finn
(Chairman Liquid Milk Committee)
Oranmore,
Co. Galway
Tel: 087 2830432
Taken from Irish Tractor & Agri magazine Vol 5 No 4, June 2017
