Liquid Milk Producers Leaving Sector as Costs Escalate

IFA Liquid Milk Chairman Keith O’Boyle has said that escalating costs has eroded the profitability and sustainability of liquid milk producers.

Since last winter, feed, energy and fuel costs have risen by 14%, 21% and 22% respectively (Sept ’21 vs. Sept ’20), and that’s before fertiliser, which will be more than double next Spring. 

“While input costs are rising sharply, the retail price of milk has remained the same for the past decade. The National Milk Agency estimates that 70% of milk sells under private label, which typically carries a 27% discount,” he said.

“We are seeing a massive exodus of farmers from the liquid milk sector as the premium over the winter no longer covers costs, let alone leaves a profit.  Last year, 20% of liquid milk producers exited the sector,” he said.

“If retailers and consumers want a consistent supply of high-quality, fresh milk throughout the year, they simply will have to pay more for it,” he said.