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Monday 19 November 2018

Dairy product prices have significantly weakened in recent weeks, Dairygold warns despite holding milk price

Ciaran Moran

Ciaran Moran

The Dairygold Board has today decided to maintain the base price paid for milk supplied in September at 32cpl inclusive of 0.5cpl quality bonus and VAT, based on standard constituents of 3.3pc Protein and 3.6pc Butterfat. 

However, it also said that this current milk price does not reflect current market returns as product prices have significantly weakened in recent weeks.

It comes as Glanbia and Lakeland also announced September milk prices, complete with warnings about the global outlook.

A spokesperson for Kerry said its base price for September milk supplies would remain unchanged at 32c/L (VAT inclusive)

Glanbia announced last week that it was paying its member milk suppliers 32c/L (including VAT) for September manufacturing milk supplies at 3.6pc butterfat and 3.3pc protein.

This is unchanged from the August price paid to members, it said. 

Chairman Martin Keane however warned that Glanbia's milk supply was very strong compared to the same month last year and that this surge in milk supply has coincided with a very strong start to the New Zealand milk production season, with a cumulative 15pc drop in the GDT price index since June resulting in reduced forecast milk prices.

“It should also be noted that there has been a rapid decline in European butter markets, with Dutch Dairy Board reported prices down from €6,100 per tonne in June to €4,700 per tonne this week.”

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Lakeland Dairies has held its base milk price at 32.78c/L (including VAT) for September milk supplies.

It also said that market demand has weakened for butter and milk powder.

Milk supplies are generally strong at present and are up by over 10pc in the current month compared to the same time a year ago.

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