Addressing the 131^st ICOS Annual General Meeting today, the co-operative body’s President Edward Carr said that Irish agriculture and the co-operative movement are entering a period of profound change.

“This will require greater strategic collaboration, innovation and long-term thinking if Ireland is to remain competitive in increasingly demanding global markets,” he said. “With Ireland’s milk pool expected to remain broadly static in the years ahead, the sector must focus on extracting greater value, improving efficiency and strengthening competitiveness.”

Edward Carr highlighted figures provided recently by Rabobank at a meeting of the ICOS Dairy Committee with Minister Martin Heydon.

Against a backdrop of elevated EU and global milk supply, Rabobank outlined consolidation trends and forecast that EU milk production could decline by about 5% between 2025 and 2030. This contraction reflects tightening environmental and climate regulations, land use constraints, rising input costs and an ageing farmer population.

“For Ireland, as a major global dairy exporter, maintaining competitiveness will be critical. The analysis indicated that structural pressures will accelerate consolidation across European dairy processing as tighter milk volumes drive processors to seek scale, secure supply, improve efficiencies and manage volatility. It was also noted that consolidation can deliver efficiency gains of 4% to 5% of revenues through operational integration, procurement efficiencies and better asset use.

“This necessitates an open-minded approach to enhanced co-operation across the sector, including joint ventures, shared services, strategic partnerships and other collaborative initiatives that can help co-operatives achieve scale, reduce costs, develop new markets and better manage volatility.

“Our co-operative model has always been built on collaboration and there is significant scope for the sector to work together in new ways that strengthen farmer returns and safeguard the long-term future of rural communities,” he said.

Edward Carr said the industry also faces a critical period of policy change at European level.

“The future of the Common Agricultural Policy (CAP), concerns regarding potential reductions in CAP funding, ongoing challenges with the Carbon Border Adjustment Mechanism (CBAM), environmental regulation and geopolitical uncertainty all have significant implications for Irish farming and food production.

“Europe and Ireland must recognise that food security, strategic autonomy and environmental sustainability are combined objectives. A strong, properly funded CAP remains essential to underpin farm viability, investment and rural development.

Mr. Carr stressed that generational renewal remains one of the greatest challenges facing Irish agriculture.

“We cannot take the next generation of farmers for granted. Young people will only commit to farming if they can see a viable future, a reasonable income and a supportive policy environment. This will be the subject of a major conference that ICOS is organising for 5^th November next and around which details will be announced in the coming weeks.”

“Irish farmers also need to be supported and incentivised with measures that reduce the sector’s exposure to market volatility shocks.

“It is disappointing that the Government has not yet seen fit to introduce a farm income stabilisation scheme. As proposed by ICOS, this would enable farmers to set aside up to 5% of their annual farm receipts tax-free during profitable years and draw down those funds over the following five years when incomes are under pressure. This would help farmers to manage income volatility, improve financial resilience and reduce reliance on emergency Government supports during market downturns.”

Mr. Carr said maintaining a workable and long-term nitrates derogation is critical not only for the dairy sector but for the wider agri-food economy and Ireland’s family farm model. He highlighted the extensive work undertaken by farmers and co-operatives to improve water quality and environmental performance and said this progress must be recognised by policymakers.

The ICOS President also paid tribute to Ireland’s livestock marts, describing them as one of the most important institutions in rural Ireland.

“The co-operative marts system remains central to ensuring transparency, competition and fair market pricing in the livestock trade. At a time of significant change across agriculture, the role of marts in protecting farmer interests and maintaining vibrant rural economies is as important as ever,” he concluded.