Seán Ó Fearghaíl (Kildare South, Fianna Fail)
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Question 369: To ask the Minister for Agriculture, Food and the Marine his views on the prospects for the dairy sector in 2012; and if he will make a statement on the matter. [39525/11]

Simon Coveney (Cork South Central, Fine Gael)
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I believe the prospects for the dairy sector are very positive in 2012 and beyond. Dairy markets have recovered fully from the 2009 price collapse, with EU and World Markets performing strongly this year, and the short term outlook remains positive. This market buoyancy is good for Ireland, as we export over 80% of our dairy production. Last year exports of Irish dairy products and ingredients were valued at some €2.3 billion, an increase of 17% from 2009.

The effect of this recovery can be seen in the average milk price paid to Irish producers. In 2010 this was over 30 cent per litre, well above the 2009 average of 24 cent. This year farmers are currently receiving 34 cent per litre for their milk.

In recent years the dairy sector has experienced extreme volatility in product prices, primarily caused by an imbalance of supply and demand in international markets. While there will always be short term fluctuations in dairy prices, it is important to remember that the medium term prospects for global dairy markets are good. Growth in global population and wealth is forecast to stimulate strong levels of demand for dairy products, and I am confident that the Irish dairy sector is well placed to benefit from this additional demand.