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Minister Smith cautions about "very real possibility of Milk Super Levy"

The Minister for Agriculture, Fisheries and Food, Brendan Smith TD, today cautioned milk producers about the "very real possibility of a milk super levy being incurred at the end of the 2010/2011 milk quota year in March."

The Minister said that there had been a sharp acceleration in milk production up to the end of 2010, with butterfat-adjusted deliveries running at 2.35 per cent under quota at the end of December, having been 5.15 per cent under quota at the end of September. The Minister confirmed that early indications were that the acceleration in supply had continued into the early weeks of 2011, thus increasing the likelihood of a super levy being incurred.

Mr Smith said that he acknowledged that "in these more volatile and challenging times, the priority for a producer must be to produce as much milk as possible, at the lowest possible cost.  This is, of course, particularly important to those producers looking to expand and develop their enterprises. However, it is equally important that an appropriate balance is struck and that producers observe quota limits and not run the risk of incurring a potentially ruinous super levy."

Minister Smith noted that there has been significantly greater heifer retention on dairy farms in recent years, with an increase of over 14 per cent in the number of dairy calves born between 2008 and 2009. Mr Smith warned that there would be a need to "actively manage the avoidance of incurring a super levy all the way to 2015. The alternative prospect is that farmers who fail to take account of continued quota restriction could be left with super levy bills in each of the remaining years prior to quota abolition."

Date Released: 26 January 2011