by Dennis Halladay, Western Editor
Dairy quotas in the European Union end in March 2015, and onetime export heavyweight Ireland is anxious to rejoin the global marketplace.
It is a nation with a long history of low-cost milk production, high-quality products, smart business owners and successful international selling. U.S. dairy producers may not know it, but 30 years ago, Ireland was close to New Zealand in total milk output. Today, it is less than one-third the size. The U.S. is more than twice their size combined.
The Irish dairy industry began preparing for the quota barrier to drop more than a year ago and thinks it could boost total milk supply by 50 percent within five years. Most or all of that would need to be exported.
But there's a risk they see to Irish farmers making big financial investments to increase output that much and that fast: the United States.
Thirty years ago, the U.S. was a nonfactor in dairy export markets. Now, it's a major player. A huge reason is the dramatic narrowing of production cost advantages that pasture-based countries like New Zealand and Ireland once had over the U.S.
It's a gap that Irish dairy leaders say may continue to narrow due to falling feed and energy costs, so they are urging their producers to be cautious about taking on debt and to be conservative with expectations about what milk and feed prices will be.
