Dairy farmers caught in post-quota reality

Friday, 8th April, 2016 4:12pm

Dairy farmers caught in post-quota reality

In the run up to the removal of milk quotas, experts had warned of price volatility - but, the Celt asks Crossdoney farmer Andrew Smith, did he ever think it would be this bad?
“We knew it was going to be bad but I didn’t think it would be the case that it was going to cost more to produce than you were getting,” says Andrew.
“The price at the minute - it’s 24.5c/l and it’s costing nearly 27.5c/l - it’s not sustainable. But when you’re in it the way we are you have to stay at it, because you still have your debts to pay, loans to pay - you’ve no other choice. What do you do? Sell up? What then?”
The low price is preventing Andrew from pursuing farming full time, leaving his father to run the enterprise alone. It’s a familiar story. At the recent IFA election debate in Cavan, presidential hopeful Joe Healy said that the average farm income was now just €24,000. Andrew’s holding down a job with Sean Brady’s Engineering and Construction company in nearby Killeshandra.
The Celt notes that volatility implies that it will fluctuate up as well as down, but we’ve yet to enjoy an upturn in prices.
“No, not yet, and it doesn’t look like it for this side of the year either,” he concedes. “You just have to keep going and grinding it out and trying to cut costs where you can.”
Another cost is incurred as we chat through the window of his jeep over the idling motor at the wonderfully named townland of Farrandaly.
The Smiths have hired Joe Brady & Bryan Lynch contractors to spread slurry on their 15 acre outfarm, which is prone to flooding in winter. While they can look after the homefarm, visible on a distant hill, with their own machinery, the “very boggy” land here demands heavy duty tractors.
It’s part of Crossdoney that succumbed to the encroaching Trinity Lake and torrential downpours over Christmas.
“I’ve never actually seen it up as high as this year,” Andrew says.
They invested in the land when they purchased it about 15 years ago for silage ground.
“There had been a lot of small fields, but we took out a lot of hedges and drained it - we still get a good enough two cuts off it, and it wouldn’t be too bad.If you break the sod out there, you’d say good-luck to one of those tractors nearly.
“Even when we’re cutting it in the summer, you see the harvester going like that,” he says with a laugh, gently swaying his hands out front like a boat lolling on the lough.
The post-quota era was supposed to herald exciting times for the dairy sector, with New Zealand style growth predicted. The Smiths approached it with cautious optimism.
“We probably went up another 20 or 25 cows, and we rented a bit of ground beside us about two years ago. We were looking to go up in numbers another bit. Through time you would probably be hoping to go up, but you nearly couldn’t with extra feed costs, and fertiliser costs... everything.”
The Smiths are prioritising what they can control within the farmgate, increasing proteins and solids to boost prices and focusing on getting their breeding system right. They use AI, and any cows that don’t go into calve, they follow up with their whitehead stock bulls. Off the top of his head Andrew estimates that 80% of his Friesians have calved. “We’ve tightened up a good bit on that,” he says.
He and his father could focus more on this if he wasn’t holding down a full time job - that’s dependent on the milk price though.

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