Organic success leaves Ireland with a quota quandary

Jimmy Mulhall’s organic dairy farm could produce nearly double its current milk output, but his aspiration for growth is being thwarted by the country’s milk quota regime.

Under the terms of the Ireland’s restructuring scheme where quota transfer is regulated by government, Mr Mulhall can only buy organic quota from his dairy when another producer gives it up.

He is keen to milk more cows because the premium he gets from his buyer makes it his most profitable enterprise.

But with few organic producers pulling out, the opportunities for buying quota are few.

Mr Mulhall believes it’s time the system was reformed.

“If I could buy more quota I would cut back on my sheep enterprise, but if farmers don’t give theirs up there is none available from the dairies.”

Mr Mulhall’s quota is for 240,000 litres, but he calculates that his 102ha (252-acre) farm at Ballickmoyler, Co Carlow, is capable of producing up to 450,000 litres.

In the hope of acquiring more quota and expanding the current herd he has bred 16 heifers, but the uncertainty makes it difficult to plan ahead.

“I don’t know whether I should sell some heifers before next spring or put them in calf,” he says.

As a member of an organic supplier group, Mr Mulhall is lobbying the Department of Agriculture to release more milk into the restructuring scheme although, ironically, it’s probably that shortage of milk quota that is maintaining the organic price at 26p/litre, compared to the 17.7p/litre paid to conventional producers.

The farm supplied milk to Glanbia, but transferred three-quarters of its quota to yogurt maker Glenisk when organic conversion was completed – a move that attracted an extra 13,500 litres of non-transferable quota.

Milk is still supplied to Glanbia at the conventional price for three months in summer when milk quality slips below the yoghurt contract specification.

“My aim is to achieve a more balanced milk profile to meet Glenisk’s needs by increasing winter production.”

He currently produces two-thirds of his production in the spring and summer running 55 highly bred British Friesian cows averaging 4500 litres/head.

“We are trying to get more cows calving in autumn and we will get nearer to achieving a 50/50 balance of winter and summer milk this year,” he predicts.

“If I could get the pattern right by supplying 40% of my milk in the six winter months I would be paid 28p/litre.”

Mr Mulhall rears all his own replacements because, like milk quota, organic stock is difficult to source.

Their fertility is generally good – his replacement rate averages 6% – but milk hygiene is a problem.

Cell counts of 350,000 cells/ml have been a recurring problem since he stopped using dry cow antibiotics.

His answer is to cull cows with the highest counts and carry extra stock to fill his milk quota.

“It is better to have a bit in hand if we find ourselves short of milk,” he reasons.

“When you are being paid a good price for something it is better to have some leeway to fill the quota.

“The milk we have to keep out of the tank isn’t totally wasted because we rear calves with it.”

Mr Mulhall is critical of the lack of research into managing mastitis without antibiotics.

The same is true of disease resistance in the organic cereal crops he grows.

“Most of the varieties are being bred for their yield and to be used with sprays,” he suggests.

This year he harvested 6ha (15 acres) of oats and 6ha (15 acres) of spring wheat with typical yields of between 3t and 3.8t/ha (1.2t and 1.5t/acre).

He currently relies on a combination of crop rotation and running a harrow through crops just after plants have emerged, but this is weather dependent.

Mr Mulhall says it is important to grow his own grain as organic feed can cost more than 200/t.

Despite his frustration at being unable to expand he says he is more confident about the future than he would be as a conventional producer.

“It wouldn’t be viable for me to produce conventional milk,” he reckons.

“Many conventional producers with 160,000 litres of quota have left the industry, but in organic production the only people who are going out of it are those who want to retire.”