Dairy problems
Stress and strain within the dairy scene in Northern Ireland has come to the surface in recent days with several producers switching to a different milk buyer and the sudden resignation of the chief executive of Fivemiletown Co-op.
Milk producers have been under severe pressure due to adverse weather and rapidly escalating prices for feedstuffs, leaving many businesses losing heavy sums on a monthly basis -- and the bigger the herd, the more they are losing.
This is fertile ground for some milk buyers who are active in seeking to 'sign up' new direct suppliers. Other buyers are having to respond in an attempt to hold what they have.
While Fane Valley has been the pace setter since April as it 'buys' a milk pool from farmers attracted by the immediate higher prices, Connacht Gold is believed to be set to match the Fane Valley price for September supplies as it tries to hold on to the milk pool it acquired with the purchase of the dairy business of Donegal Creameries.
There are also reports of a back-payment from Connacht Gold adding 1.25p/litre to their August milk price.
Meanwhile, United Dairy Farmers has lifted its base price to 25.25pence/litre for September milk -- a rise of 1.25p over the previous month.
This is in line with the upward movement at the milk auction. Following the average 1.8% increase in commodity prices at the Global Dairy Trade auction on Tuesday, the Ulster Farmer' Union says it anticipates another rise in next week's auction of milk by United Dairy Farmers.
However, the likely end of the monthly milk auction in Northern Ireland is looming closer as a 'shake down' of the dairy sector is currently underway.
While United Dairy Farmers has announced its intention to double the cheese manufacturing capacity at the Dale Farm Dunman factory, the producer co-operative is also losing some of its milk supply base as some members opt to go elsewhere with their milk.
The line from Fivemiletown is that the chief executive, Mervyn McCaughey, resigned for personal reasons and that the board appreciates his contribution to the business over the past eight years and wishes him well in the future.
But Irish Farmers Journal sources indicate that tensions surfaced over the way in which the business has been running since the loss of the cheese curd sales contract with Kerry Group in the spring.
Fivemiletown has been struggling to replace that outlet for a major part of its production and has laid off several employees. The business has been highly dependent on the 'spot' market as an outlet for milk.
Sales of raw milk to Britain have been at relatively high prices recently and this has been a lifeline for Fivemiletown, at least in the short term.
The resignation was more or less immediate last week and the day-to-day running of the business is now in the hands of Carole Graham, the company secretary, Tim Cander, the production manager, and Kevin McManus, sales manager. None of these has returned calls seeking further information.
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Source: farmersjournal.ie