Aindrias Moynihan (Cork North West, Fianna Fail)
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238. To ask the Minister for Agriculture, Food and the Marine if his attention has been drawn to dairy farmers who find themselves locked into fixed-priced milk contracts in view of the ever-increasing production cost in the industry; and if he will make a statement on the matter. [28387/22]

Charlie McConalogue (Donegal, Fianna Fail)
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The nature of all markets, particularly in export dependent sectors such as dairy,  is that prices will fluctuate.   

Curtailed global supply and sustained demand for dairy ingredients have now meant that markets prices are remaining positive. However, I am acutely aware of the pressures that farmers are under at present, arising from rapid increases in input costs. 

Fixed price contracts are a commercial decision between dairy co-ops and their suppliers, and indeed can be an appropriate risk management tool for suppliers to guard against times of high volatility in milk prices. 

I am aware that the unprecedented increase in input costs is creating particular difficulties for dairy farmers who have a significant share of their milk supply locked into fixed price contracts currently. I am pleased to see the recent move from many of the dairy Co-ops who have responded by increasing the price paid to farmers on existing fixed milk price contracts with an additional supplementary payment in response to increasing production costs. 

I emphasise that it is not within my remit as Minister for Agriculture, Food and the Marine to intervene in commercial arrangements between supplier and purchasers. I am also aware that contractual arrangements will exist at other points of the supply chain. 

However, I will continue to engage closely with the sector as we work together on the significant challenges arising from the illegal invasion of Ukraine. My Department will continue to monitor the market situation for dairy and other agri-food commodities.