Farm Ireland
Independent.ie

Tuesday 6 December 2016

Kerry milk suppliers to escape superlevy

Declan O'Brien

Published 29/02/2012 | 06:00

Kerry Group's 4,000 dairy farmers have been given the green light to increase milk supplies for the last month of the quota year.

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While the latest national figures indicate that a superlevy fine is almost inevitable, Kerry Group is estimated to be 3m gallons under quota to the end of this month.

Local farmers have been told that unprecedented milk supplies would be needed during March for the southern milk processor to go over quota.

Kerry farmers were informed of the revised quota situation last week and were given the go-ahead to drive on supplies for next month if they wanted.

However, a spokesman for Kerry Group pointed out that very few cows were out on grass in the southwest due to poor grazing conditions.

One industry source said Kerry officials had played a "very smart game" in the manner in which they had managed milk supplies through the year.

"Kerry maintained they were over quota right up to the end of December. This meant they took in very little milk during December and January and gave themselves some leeway for March," the source said.

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The situation across the southern half of the country is very different, with both Glanbia and Dairygold certain to be over quota.

Supplies to Glanbia were reported to be running 4.1pc over quota, while Dairygold was 2.8pc over.

The latest official figures for milk deliveries show that the country was just 0.3pc under quota to the end of last month.

Last year, when Ireland barely avoided a superlevy fine, supplies were running at 1.4pc under quota at the end of last month.

Meanwhile, ICMSA president John Comer has expressed concern that milk price seemed to be a "marginal" issue in discussions on deeper co-operation between dairy processors.

"Farmers -- whether they're suppliers or members of a processor board -- must insist that a commitment to return a competitive milk price is at the centre of any decisions taken," Mr Comer said.

In other dairy sector news, speculation is growing that Glanbia is about to unveil a second three year forward-price milk contract offer.

There are no details yet but it is thought unlikely that this latest contract will include an option to increase the base price to allow for any increase in input costs. A base price of 31c/l has been suggested.

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