1st Published 15/06/2022 in The Farming Independent
Agricultural Consultant and managing director at Brady Group: Agricultural Consultants & Land Agents. The Lodge, Lee Road, Cork.
Survival of the fittest has left UK dairy farmers with similar climatic benefits to Irish dairy farmers but have the added advantages of land availability, larger farm size and a huge domestic market on their doorstep.
Sometimes you have to go abroad to appreciate what you have at home.
I recently participated in a UK Nuffield Dairy Tour to Drumfries in Scotland. When dairy farmers and their advisors plan ‘busman holidays’ the traditional destinations of New Zealand, USA, Holland and Denmark usually come to the fore. However, there is a hidden gem in the Dumfries region of Scotland.
A short 2 hour ferry crossing across the Irish Sea from Belfast Harbour to Cairnryan / Stranraer opens the gate to large tracts of rolling grassland with spectacular views of Loch Ryan and the Irish Sea. We forget that this land is just 45 miles away from Ireland.
Dumfries is the capital of the region with a population of 33,000 people, it also contains the Crichton Royal Farm which is the centre of dairy research for Scotland Rural College (SRUC) which essentially is the Scottish version of Teagasc.
A debate at the college farm exposed the debate at the heart of UK Dairying; the confinement dairying high output system versus the grass based low input system.
It reminded me of this debacle playing out in the Republic of Ireland over 20 years ago. In any debate or discussion there are three options to come to a conclusion; 1) agree, 2) disagree or 3) procrastinate. In Ireland we made a decision to follow the grass based low input system, but in UK Dairying they are still procrastinating.
The reasons for this indecision are many and but from my experience and observations the main three are as follows:
- Margaret Thatcher’s Privatisation and Sale of State Agricultural Advice and Research
In the late 1980’s the then Prime Minister, Margaret Thatcher was examining the cost and benefit of state institutions. The Agricultural Development Advisory Service (ADAS), was the organisation within Ministry of Agriculture Fisheries and Food (MAFF) that conducted agricultural research and advice at that time. Margaret Thatcher’s attitude was to privatise any successful parts of ADAS and close down the rest: She stated ‘This Government was not elected to grow flowers!’ ADAS subsequently became an executive agency of MAFF and was eventually privatised in 1997.
This lack of independent advice and research in the subsequent 25 years has left British dairy farmers rudderless and at the mercy of the market when making decisions about their farms and farm businesses. Some have survived and prospered many have not.
- Private milk processing model
The most important question to ask a British dairy farmer is, who buys the milk produced on the farm and what are the terms and conditions of the Milk Supply Contract?
This could determine the very existence of a dairy farm in the UK. With a human population of 68 million people and just 7,880 dairy farmers, 9 milk processors collect over 70% of the milk and produce a wide variety dairy products.
This results in many variations in the type and terms of Milk Supply Contracts signed by individual dairy farmers. In the past individual processors have failed and left dairy farmers without a ‘milk cheque’ and even not collecting the milk, which is unheard of in Ireland.
The British dairy farmer is much closer and in tune with to the vagaries’ of dairy markets. In contrast many Irish farmers accept that the processing and marketing of milk is somebody else’s problem outside the farm gate. This is a because most of the milk processing in the UK is privately owned whereby most is in a Co-Operative structure owned by farmers in Ireland.
- Wealthier Farmers
Traditionally, British dairy farm businesses are larger and wealthier than their Irish equivalents. More land and off-farm interests/assets have produced stronger balance sheets. This has cushioned some UK dairy farmers from incorrect investment decisions and enabled them to change direction or weather a crisis better than Irish farmers over the years.
However, given the lack of national direction via advice and research over the last 25 years many UK dairy farmers are flourishing. Committed UK dairy farmers in both the confinement and grass-based systems have travelled the globe in search of advice and research on how to make their businesses more profitable and sustainable. The confinement dairy farmers looking to the US and grass-based looking to Moorepark in Ireland for direction. The message here is that good dairy farmers will always find a way.
We presently have a thriving dairy industry here in Ireland with a clear focus at farm, processing , retail and government level however, we cannot rest on our laurels. The remaining 7,880 UK dairy farmers have arrived at this juncture by survival of the fittest in a tough less protected market environment. They have similar climatic benefits to Irish dairy farmers but have the added advantages of land availability, larger farm size and huge domestic market on the doorstep.
There are definitely more opportunities for new entrants to lease or enter partnerships on dairy farms of a viable size to provide sufficient income for all parties and there are also many opportunities for those interested in owning / managing multiple dairy units, there were examples of both in Dumfries.
As already stated, sometimes you have to go abroad to appreciate what you have at home, but it’s clear from my trip to look at UK dairying that we need to quickly agree and put in place our plan for the next 20 years of the Irish Dairy Industry.
The opportunities open to UK based dairy farmers and processors have the potential to pass us out on all fronts unless use our unified team industry approach to innovate and implement this plan. Just because it worked before does not mean it will work again.
Table 1: Republic of Ireland -v- UK Dairying
|Dairy Farmers (no)||16,000||7,880|
|Dairy Cows (no)||1.65 million||1.85 million|
|Milk Produced (litres)||8.5 billion litres||15.3 billion litres|
|Herd Size (no)||103||148|
|Yield per Cow (litres)||5,450||8,200|