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Group pictured the recent Farm Financial Planning event held in Dromtariffe were, (l to r): Ciara O’Shea, Teagasc, Tom Aherne, Milk Supplier, Donal Buckley, Dairygold Board, Michael Downey, Milk Supplier, John O’Sullivan, Milk Supplier, Diarmuid Corkery, Milk Supplier and Billy Cronin, Dairygold.

Over 800 Dairygold milk suppliers attended workshops and seminars on Farm Financial Planning organised by the Society, in conjunction with Teagasc across its catchment area over the last five weeks. Financial planning at farm level has been identified by the Co-Op as a key issue for dairy farmers proposing to expand milk production post quota. The events were organised to assist them in planning and managing their finances on an expanding dairy farm.

The events focused on the important difference between farm profit and cash flow and how a profitable farm can often run into difficulty because of poor cash flow. The event looked especially at the financial implications of investment in expanding farm facilities like milking facilities, milk storage, slurry storage and cattle housing and how bank loan repayments should be managed. Farmers were encouraged to be very mindful of cash flow and borrowing repayment capacity.

According to Dairygold chief executive Jim Woulfe, Dairygold is continuously working with its milk suppliers on the farm development front.

"The critical element now, as we head into 2015, is that Dairy farmers know the precise cost of milk production on their farms. Dairy farming is a business and our milk suppliers need to have a clear indication of their own business costs and profit margin. Investment in expansion adds a new dimension to this skill and we want to address that."

The chief executive went on to stress that expansion on most dairy farms will require a significant capital spend and the skill set required to manage finance in an expanding business is very different from a static one.

"This was a lesson many farmers learned to their cost in the late 1970s and early '80s. We do not want to see farmers repeat those mistakes of that era," he said. "Prudent cost-benefit investment is advised with clear repayment capacity,” he added.

Two events a week were organised across counties Limerick, Tipperary and Cork over a five week period from 5th November to 5th December.

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