Don’t miss this month’s new look Dairy Farmer. Take a look at the digital edition today.
To kick things off we have the shock of Freshways’ thunderbolt 2.1ppl drop to 25p, shortly followed by a similar movefrom Meadow Foods who partly lay the problem on the 29-year high of milk production this summer.
Such moves at this time of year take us entirely in the wrong direction, but if you are in any doubt about the challenges ahead, you only have to look at the implications of a no-deal Brexit in the latest figures from the Dairy Group. These show a potential tariff on cream of 0% import and 37% export, raw milk 0% and 63% and cheese 7.5% and 40%. And for good measure follow that with a look at Sean Rickard’s assessment on p4.
According to BBC’s Newsnight on August 7, some 45,000 dairy cows in Northern Ireland may have to be culled to ensure its milk price does not collapse.
That is because Northern Irish milk will not be able to be used by Republic of Ireland processors due to standards compliance rules, and if they don’t kill it stone dead, the predicted 19ppl tariff will.
Quite where Newsnight got its 45,000-cow figure from is anyone’s guess, but there is no doubt Northern Ireland will need a home for the 800 million litres of milk a year that normally flows from there to the Republic.
It’s true some could be dried in Northern Ireland, but then where does it go? As Freshways reports, there is more than enough milk floating around putting pressure on prices and factory capacity alike.
Predictions are that Northern Irish companies will be okay for the first month after a no-deal Brexit, which takes us into December. Then it’s three weeks until the Christmas shutdown, when the spot price crashes, and then we have three months until the crunch time flush.
By the time you read this, we will only be 70 days away from the October deadline, when we will leave the EU ‘do or die’.
For the dairy industry, it looks like there’s still a lot of ‘doing’ to be done!