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Saturday 25 February 2017

Lakeland only dairy to lift price

Declan O'Brien

Declan O'Brien

Lakeland Dairies has moved to raise its milk price for last month, but all the other major processors have held returns at November levels.

Lakelands will pay 30.5c/l including VAT (29c/l excluding VAT) for December supplies, an increase of 0.5c/l.

However, Glanbia, Kerry and Dairygold all said that they are holding at 30c/l including VAT.

Centenary and Town of Monaghan are also staying on 30c/l including VAT, while Arrabawn is staying at 30.5c/l including VAT.

The Lakeland Dairies move has been welcomed by both the ICMSA and the IFA.

The IFA's Kevin Kiersey said Lakeland Dairies had taken a first step to pass back improved market returns to farmers.

He called on all co-ops, in the context of rapidly rising on-farm input costs, to examine the scope for an end-of-year top-up on last year's milk and to start passing benefits of the significant market improvements of recent weeks back to farmers.

The ICMSA's Pat McCormack called on co-ops which had yet to pay an end-of-year bonus to do so as soon as possible.

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There was surprise across the industry that the Irish Dairy Board (IDB) failed to raise returns to co-ops for last month's supplies -- returns for butter were cut by €150/t and skim milk powder (SMP) by €100/t in November.

"We calculate that gross spot returns for Dutch food-grade SMP and butter this week, before processing costs, exceed 37c/l -- an improvement of over 3c/l since late November," Mr Kiersey said. "With fast rising input prices, we estimate that, to maintain margins, dairy farmers will need an average 2011 price at least 10pc (3c/l) higher than the 2010 average."

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