Ireland is "exceptionally exposed to global volatility" in dairy because its home market is so small, Conor Mulvihill, director of Dairy Industry Ireland (DII), told Agriland at the National Ploughing Championships. Nineteen litres of every 20 produced have to leave the island, he said, which leaves Irish farmers paying the global price.

Mulvihill described 2025 as a "Carlsberg year for dairy", with most milk supplied before prices began to fall. International oversupply and a rapid shift in demand between products, with butter prices declining while demand for proteins rose, all fed into the lower milk prices that followed. With global milk production now down, he sees "a lot of green shoots". "When there's less milk, prices go up, simple as that," he said. "The biggest corrector of low prices is low prices; the biggest corrector of high prices is low prices."

His larger argument is that Ireland should start thinking of itself as a nutrition industry rather than a dairy industry. Interest in whey-derived proteins is exploding, he said, pointing to demand linked to GLP-1 weight-loss medicines. "Butter will always be fantastic for us, but the protein boom has huge opportunities for Irish farmers," he said, adding that if industry, farmers and government double down on protein, Ireland's pasture-based, family-farm, co-operative model leaves it well positioned.

The mood among farmers is less certain. A survey by Opinions, commissioned by Agriland and the Irish Creamery Milk Suppliers' Association, found that one in three farmers intends to leave farming within five years; 68% see rules, regulations or bureaucracy as a major obstacle and 48% cite environmental constraints.

The nitrates derogation, won only after a hard fight for the current period, is the next uncertainty, with the 2029 position unclear. Mulvihill said he dislikes the word derogation because it implies farmers are seeking something they should not have, when in fact they apply the nitrates directive in full. "We have some of the best water quality in Europe; we have some of the lowest nitrates levels in Europe; we have a grass-based system that takes up the nutrients," he said, calling it a "brilliant case" for negotiators returning to Brussels.

He appealed to farmers to support DII in gathering the data that will make the case for a derogation beyond 2028, saying the "trojan work" of Irish dairy farmers and changing markets still leave the industry with a positive outlook despite dark clouds ahead.

Source: Agriland