Joanna Tuffy (Dublin Mid West, Labour)
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Question 160: To ask the Minister for Agriculture, Fisheries and Food if his attention has been drawn to the outlook for the price of milk in 2010; and if he will make a statement on the matter. [3888/10]

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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The international dairy industry continues to face serious challenges at present. Over the past couple of years we have witnessed extremes of volatility in dairy product prices on an unprecedented scale. Markets for dairy products remain fragile, primarily due to a collapse in demand caused by the global economic downturn. During 2007 dairy prices reached record high levels during the international commodity price boom. In 2008 world dairy markets returned to far lower levels and this continued into early 2009, before gradually improving later in the year. We have seen the effect of these international low level prices finding their way back through the milk chain to primary producers.

In recent months, there has been an improvement in prices on dairy markets and it is hoped that this will continue in 2010. However, it is not possible to predict exactly what milk price farmers can expect to get this year.

While the immediate outlook remains somewhat uncertain, it is important to remember that the medium term prospects for global dairy markets are good. Growth in wealth and population is forecast to stimulate strong levels of demand for dairy products and returns will improve to all parts of the sector. The Government is committed to ensuring that the Irish dairy sector reaches its full potential. One of the major challenges in the medium term will be to ensure that Irish farming and the agrifood sector is at the heart of an evolving high-value food market, which is focused on quality and innovation. This is at the core of Government strategy which sets out a series of actions to develop a competitive, innovative and consumer focused agri food sector.