Dairy board slashes butter price by €600/t
Fears grow of serious drop in milk price for peak supply months
The Irish Dairy Board (IDB) has slashed its butter price by €600/t for April supplies.
In what amounted to a major readjustment in the prices paid to its processor members, the board also cut the quote for skim milk powder (SMP) by €150/t.
The move equates to a 4c/l drop in milk price and will add to dairy farmer fears of a serious cut in returns from processors for the peak supply months of April to July.
The ICMSA has roundly condemned the IDB decision. Its deputy president, Pat McCormack, expressed anger at the timing and scale of the cuts.
But processors said the price reductions reflected the continued weakness of global dairy markets. While industry sources accepted that the trade appeared to have settled recently, they claimed that Irish milk prices were significantly out of line with what was happening on commodity markets.
Depressed world markets have already had an impact on local milk prices, with Arrabawn pulling its March price by 1.95c/l to 32.5c/l (VAT inclusive).
However, in the wake of the IDB's move, it is anticipated that the main players in the sector will follow Arrabawn's lead by cutting prices for April.