Lakeland Dairies boosts milk price for June supplies
Lakeland Dairies, became the first processor to announce its milk price for June supplies increasing its price by 1c/L to 33c/L including VAT.
All market indicators are now positive for milk prices with EU statistics showing that butter prices have increased by 17pc, SMP by 14pc, WMP by nearly 9pc and cheddar by over 7pc since late April.
Irish milk production in 2017 has been running significantly ahead of last year. Domestic milk intake by creameries and pasteurisers was estimated at 997.0m litres for May 2017, according to latest figures from the CSO. This was 7.3pc above the corresponding 2016 figure.
The Chairperson of the ICMSA Dairy Committee said that milk suppliers were perfectly entitled to feel short-changed last month by the single cent price rise announced by both Glanbia and Lakelands.
Gerald Quain said that the overwhelming body of data right throughout the EU and further afield both indicated and supported a higher milk price of 33c/L and the decision of both Co-ops to pay a full cent less was profoundly disappointing and in defiance of all the market indicators.
He noted that withholding this extra cent amounted to withholding around €450 from a typical 300,000L supplier’s May cheque.
He said that the only conclusion that the suppliers could arrive at was that a conscious decision had been taken by the Co-ops to ‘sit’ on the increased margins they were themselves receiving for at least an extra month before passing the benefit back to their suppliers.
"This had become a established and disturbing element with Irish milk price cycles that sees falls in international dairy markets passed back instantly to farmer-suppliers while market rises are dribbled back on a ‘low and slow’ basis," he said.