Milk on the production line©Rex

Every dairy farm in Northern Ireland is under severe financial pressure, according to the Ulster Farmers’ Union (UFU).

Milk producers are running their businesses at a loss to the tune of around 7p/litre, UFU director general Wesley Aston told visitors the the Balmoral Show on 14 May.

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“Simple economics dictate that every dairy farming business in Northern Ireland is under severe pressure,” said Mr Aston.

“But the medium to long-term prospects for dairy remain extremely positive. The question is: when will international markets start to turn around? And this really is the great unknown.”

He revealed that the union has held talks with bank officials to ensure that the financial support which milk producers need is made available to them.

And he claimed Brussels could do more to support milk prices. He said that the current aids to private storage and intervention measures were totally out of kilter with the costs incurred on dairy farms.

“I take some heart from the fact that this week’s CAP simplification discussions in Brussels may give the EU Commission more flexibility in bringing forward market support measures that can provide milk producers with a more meaningful safety net.”

Meanwhile Lakeland Dairies CEO Michael Hanley reckoned that although global demand for dairy products had continued to strengthen, international milk output was simply outstripping the requirements of the market.

“Europe, the United States and the New Zealand have all enjoyed perfect weather conditions over the past year,” he said.

“As a consequence, it may well be six months before farmgate returns in this part of the world start to strengthen.”

He continued: “We saw an upturn in prices paid at Fonterra’s Global Dairy Trade Auction during the early weeks of 2015. This reflected the belief that drought could have a downward impact on New Zealand milk output at that time. However, this failed to materialise.”