ICMSA: Principle of protection for suppliers should be 'applied to all'
A proposal to impose "specific requirements" on milk processors through written contracts with suppliers should apply to all milk processors, including co-operatives, "without exception", according to the Irish Creamery Milk Suppliers’ Association (ICMSA).
Commenting on the current discussions in relation to milk supply contracts at EU level, the chair of the ICMSA's dairy committee, Noel Murphy said that there should be no "get out clause" for anyone.
He said: "While the detail of the proposed contracts can be refined, the principle of greater protections for individual milk suppliers should be applied to all, and supported by all.
"In the context of the reduced importance of CAP payments due to convergence and the lack of indexation, the returns from the marketplace have assumed paramount importance."
"It’s imperative that farmers can judge their milk processors performance over time and, in particular, that the price being paid at any given time can be seen to be reflective of developments in the marketplace, and that their co-op is performing as well as other milk processors," the ICMSA dairy committee chair added.
Murphy believes that farmers are "price takers", and said that following discussions at the European Milk Board (EMB) with colleagues across the EU, it was clear farmers were the ones "taking the 'hit'" for market volatility, whether supplying a private company or a co-operative.
He said: "This just has to change, family farms need a minimum degree of certainty in exactly the same way and for the same reasons as everyone else does.
"The proposal under the CMO (Common Market Organisation) for compulsory contracts or their equivalent under co-operative rules is a step in the right direction, and properly functioning co-operatives across the EU should have nothing to fear from this legislation, that just provides farmers with greater certainty and mechanisms to address areas of concern in relation to milk price and other issues."
"The Irish co-operative sector has served farmers well and our co-operatives should have no issue meeting these requirements,” Murphy explained.
According to Murphy, the dairy sector "from processor to retailer" is getting more concentrated and integrated "by the day", and farmers are, effectively, "at the mercy of those further along the supply chain".
"The farmer needs greater protection and the proposal on milk supply contracts will help in this regard and should be supported by the Irish dairy industry and our government," Murphy explained.
