ICMSA urges processors to hold current milk prices
Milk processors should follow the lead of Glanbia and hold milk prices for the month ahead, the ICMSA has urged.
Glanbia Ingredients Ireland (GIIL) decided to hold its June milk price at 37c/l and ICMSA claim that market conditions justify dairies holding prices at current levels.
There was further good news for milk suppliers from the Irish Dairy Board (IDB) last week when it held the price paid for key commodities.
It is understood that the IDB price for butter for June remained at €3,250/t, while skimmed milk powder (SMP) returns were up €50/t to €2,800/t.
However, there has been a €750/t drop in the butter quote since January, while SMP is down €350/t. Industry sources claim this drop equates to a reduction of 5c/l in milk price.
However, the farm organisations have rejected any suggestion that further price cuts to farmers are necessary or justified.
ICMSA deputy president Pat McCormack pointed out that the latest Rabobank report on dairy markets concluded that growth in global milk supply would slow considerably in the second half of 2014 and that consumption of dairy products was likely to increase due to improved economic conditions.
"On this basis, co-ops should now maintain the market stability by ensuring their boards retain milk price at current levels," Mr McCormack said.
"The decision taken by the board of GIIL last week to hold its June milk price clearly highlights that the market has stabilised at a high level. This justifies what the ICMSA has been saying, that dairy markets have shown improvements over the past month and that there is no justification to cut milk prices," he added.