Low-cost milk producers: Who are we kidding?

I attended the Teagasc Situation and Outlook Conference in January earlier this year. The outlook for the main farming sectors, including dairying, was outlined by the team of Teagasc economists. It was not the trend or outlook for product prices which grabbed my attention. Rather it was the alarming trend in the costs of production and the continuing variation in the cost of producing the same litre of milk on different farms. We can spend a lot of our time debating milk prices but ultimately the decision on milk price is outside of our control. On the other hand, you have control over what you spend to produce a litre of milk. I make no apology for returning to this theme: it has featured in previous articles of mine. But, unless you take action on the cost side of your business, you will not be milking cows in five years time - and that is guaranteed.