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Saturday 18 August 2018

Dairygold latest processor to cut milk price

FarmIreland Team

FarmIreland Team

Dairygold has reduced its milk price (for February milk) by 2cpl to 34 cpl inclusive of 0.5 cpl quality bonus and VAT.

This comes following Glanbia Ireland cutting its milk price yesterday by 3c/l from January levels.

It will pay milk suppliers 32c/l including VAT for February at 3.6pc butterfat and 3.3pc protein.

However, it will also include a ‘special support payment’ of 1c/l to reflect “the tough Spring” and “challenging” conditions on farms.

Kerry Group also moved to cut its milk price by 2c/l from January levels. It will pay suppliers 34c/l including VAT for February. While Lakeland Dairies cut his prices by 1c/L.

It also follows Global Dairy Trade prices slipping for the second time in a row.

Ahead of the board meeting, Glanbia Ireland’s Jim Bergin warned at the launch of the revamped Wexford cheese plant that there was an “oversupply situation”.

“Today, markets are trading considerably below the milk price, so therefore we will have to address that,” he added.

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“Farmers should stress test their budgets at 28c/l. There has been a little bit of an improvement at the lower end but the last two GDPs have gone backwards.”

IFA National Dairy Committee Chairman Tom Phelan has said differences between the milk price cuts announced by milk purchasers so far, from 1c/l from Lakeland to a massive 3c/l from Glanbia, show differences in the appreciation the co-ops have of the very real pressures a long winter, late spring and the most severe snow storm in a generation have imposed on dairy farmers. 

“Those co-ops that will set their February milk price over the coming days must bear in mind that factors other than markets must also be considered.

"While returns from dairy commodities have eased, an early and severe milk price cut will make a bad dent in farmers’ incomes for 2018, especially as the last winter and this spring will have proved very costly in fodder, feed supplementation and post-storm repairs.

“Board members who will look at milk prices for this spring must stop and reflect on the huge extra costs, workload and stresses their fellow suppliers have been experiencing these last few months.  My message to them is: make sure you maintain farmers’ confidence after a very difficult period,” Tom Phelan said.

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