Dairy farmers in warning over milk price slump

Dairy farmers have warned some of them may go out of business if the milk slump continues and they don't get a better price for their product.

The price paid to farmers is around 19p a litre at the moment, well below the cost of production and there is no sign of an improvement.

On average, farmers need around 27p a litre to break even.

There are more than 2,500 dairy farms in Northern Ireland.

Now some say they may go out of business if prices don't improve.

The Stormont agriculture committee is being recalled on Thursday to discuss the crisis, and farmers are planning a protest.

It follows an impromptu meeting that was expected to draw a small number of dairy farmers, but more than 50 of them turned up.

On average, farmers need around 27p a litre to break even

Johnny Matthews, a dairy farmer who organised the meeting, said there was an 11p a litre shortfall between what it was costing to produce and what he was currently being paid for his milk. He said many farmers were under big pressure.

"It doesn't add up and there's no way we can keep going," he added.

He said he just wanted a "fair price" for his milk.

In recent years, smaller operations have moved out of milk and farms have had to become bigger to remain competitive.

Dairy farmers are under price pressure because of a range of issues, including decreased demand from a stuttering Chinese economy and a Russian ban on EU food imports in retaliation for EU sanctions over Ukraine.

In addition the ending of EU milk quotas in April and a general increase in global production pushed up supply.

Father and son William and David Irvine milk 140 cattle on their farm near Markethill, County Armagh.

William and David Irvine's income from their farm has dropped 36% in a year

A litre of milk costs them 25p to produce. However, they are paid just 19p.

They have invested in the farm by putting in a new parlour and are servicing that debt.

They are also supporting two families on an income that has dropped 36% in a year.

With margins non existent, even a routine maintenance bill for a £1,000 electrical fault leaves them juggling the farm finances.

The EU farm commissioner Phil Hogan has resisted calls for an increase in the price at which Europe will buy milk into intervention as a support mechanism.

It currently stands at between 16-17p.

Milk prices move in cycles. In 2013 the prices were good at around 31p a litre, but since mid-2014 there has been a consistent downward slide.