The Irish Farmers' Association (IFA) has called on retailers to return an additional 7 cent per litre to fresh milk farmers this winter, arguing that the sector is facing higher costs while farmgate milk prices remain low.
The farm organisation also urged grocers to stock farmer-owned dairy brands and encouraged consumers to look for milk carrying the National Dairy Council logo.
The call is specifically aimed at the retail price of fresh milk, rather than at manufactured dairy products. The IFA said the extra 7 cent per litre should be returned to farmers this winter to help offset rising input costs.
Extra costs of year-round supply
According to the IFA, producing a year-round supply of fresh milk requires extra labour and incurs substantial additional costs. The organisation said fresh milk farmers are facing higher costs at a time when the farmgate price for milk remains low.
Henry Dunne, the IFA's liquid milk chair, said processors' premiums for liquid milk production had been eroded by the considerable decline in the base milk price over the past two years. He said the organisation was seeking a fairer share of the existing retail price.
Concentration in processing and retail
The IFA said seven milk processors handle the majority of Ireland's fresh milk and pay a premium above the standard manufacturing milk price.
It said five major supermarket retailers dominate the grocery market with a combined share of 94%. According to the organisation, an estimated 70% of retail fresh milk sales are now private label, sold at an average discount of about 15% compared with farmer-owned brands.
The IFA said private-label milk sells at a lower price than branded milk. It added that persistent pressure to cut prices has affected margins for fresh milk producers, with 66% fewer producers now than in 1995: 1,094 compared with 3,344.
Regulatory requests
The IFA has called on the National Milk Agency to ensure that fresh milk farmers are adequately compensated. It has also asked the Agri-Food Regulator to bring transparency to producer, processor and retailer margins.
The National Milk Agency was established under the Milk (Regulation of Supply) Act 1994 to regulate the supply of milk for liquid consumption throughout the state.
The organisation's intervention puts the structure of the fresh milk chain in focus: a small number of processors and retailers sit between farmers and consumers, while private-label products account for most retail sales. The IFA argues that a larger share of the existing retail price should reach farmers who carry the additional costs of year-round liquid milk production.