As the leading producers forged ahead on production in 2015, following the lifting of the cap on output after the abolition of milk quotas on April 1, 2015, the top dairymen proved their ability to capitalise on their operational advantages.
However the positive future for Irish dairymen comes with a warning that the higher cost of land and labour in Ireland, threatens to undermine some of the Irish financial advantage.
Teagasc analysis of performance on specialist dairy farms in Ireland has shown that Irish producers had the lowest cash costs as a percentage of output (77pc), followed by France (83pc), Netherlands (92pc), Germany (99pc), with the highest cash costs as a percentage of output was Denmark (120pc).
But the comparison pointed out that «when total economic costs were considered, the competitive position of the countries examined in the study changed and the competitive advantage of grass based Irish producers deteriorated when all imputed charges for owned resources are taken into consideration».
They found that «the most significant imputed costs that contributed to the relatively high total economic costs experienced by grass based production in Ireland, was the imputed charge for owned land and labour».
On a cash costs basis, per unit of milk solids, Ireland had the lowest cash costs per kg of milk solids produced in 2015 (€2.87) followed by Belgium (€2.88), Italy (€3.43),
France (€3.47), Netherlands (€3.61), Germany (€3.71) and Denmark (€4.83).
Source: Independent
Link: http://www.independent.ie/business/farming/dairy/will-land-and-labour-costs-stop-irish-dairy-farmers-being-competitive-35314515.html