Cheap imports of milk from Northern Ireland and falling world prices are forcing a showdown between Southern dairy farmers and their suppliers. Last week suppliers to Glanbia, the biggest processor in the State, placed pickets on creameries and distribution centres operated by the company.
They were protesting at a proposed cut of 9 cent per gallon of milk. Dairy farmers have seen the price for liquid and manufacturing milk drop from an all-time high one year ago to about €1.27 per gallon, a 25 per cent slump.
The pickets were called off on Wednesday for conciliation talks between the IFA and management but little progress was reported at the weekend.
It has emerged that Northern sourced milk now accounts for 20 per cent of the milk sold for human consumption in the Republic.
It has been claimed that seven major co-operatives have been importing from the North, where additional milk is being processed because of Britain's inability to produce its own supplies.
This so-called "distress milk" has disrupted the markets in Britain and Northern Ireland, and processors in the Republic are taking advantage of the low prices to import milk.
Most of the milk coming from Britain to Munster co-ops is manufacturing, not liquid milk for consumption. However, Glanbia, the largest supplier of milk to Irish homes, has complained about the increasing volume of liquid milk coming on the market in the State.