Farmers told to be cautious when expanding after end of milk quotas

Correspondent, in Naas Dairy farmers have been urged to avoid “groupthink” and getting carried away with expansion plans just because milk quotas are being abolished next spring.

From April 1st farmers will be free to produce as much milk as they wish for the first time in 30 years.

Some 250 farmers attended an IFA conference yesterday to hear about the implications They were told by Teagasc senior research officer Laurence Shalloo that expansion was not for everyone. He said there should be no expansion without a budget and a plan, and many farmers did not have a plan.

“As an industry I think you have to move away from groupthink where we all do the same thing. The farm plan should be central to the expansion process, but for a large group of you there is no plan, only increasing numbers because we can increase numbers.”

Volatility

IFA president

Eddie Downey

said dairy farmers needed support at local and European level to deal with volatility in milk prices. Milk production costs have risen by more than 40 per cent since 2005, while dairy farmers have taken an average price cut of 18 per cent in the past five months. Many farmers are also heading for a fine for exceeding their quotas as they ramp up production for a post-quota situation.

Ulster Bank agricultural manager Anne-Marie Butler said some farmers, particularly new entrants, were obsessed with new facilities such as milking parlours with "bells and whistles" rather than looking at profitability.

Mr Shalloo said young, trained, farm business managers would be the cornerstone in dairy expansion but there was not a clear career progression model, particularly for someone who did not have a dairy background.

“We want some model that allows a person in secondary school to actually decide they want to become a dairy farmer because they see they can get more money, have a better lifestyle and get higher returns than, for example, accountancy.”

The conference also heard that farm deaths and injuries might increase as dairy farms got bigger.