Farm Ireland

Sunday 24 March 2019

Glanbia announces August milk price and halts support payment

Glanbia Ireland has a 2.4 billion litre milk pool from 4,800 suppliers
Glanbia Ireland has a 2.4 billion litre milk pool from 4,800 suppliers
Ciaran Moran

Ciaran Moran

Glanbia will pay its Member milk suppliers 32 cent per litre (cpl) including VAT for August manufacturing milk supplies at 3.6pc butterfat and 3.3pc protein.

This is unchanged from the July price paid to Members. Glanbia Ireland (GI) has increased its base milk price for August from 31 cpl to 32 cpl including VAT, for manufacturing milk at 3.6% fat and 3.3% protein.

There will be no support payment from Glanbia Co-op this month.

Glanbia Chairman Martin Keane said: “The market outlook remains cautious. The level of milk supply from the main exporting regions will be a key factor determining the price outlook over the coming months. The Board will continue to monitor developments on a monthly basis”.

Lakeland Dairies has held its base milk price at 32.78 cents per litre including VAT for August milk supplies.

Dairy processors have been urged to close the gap between Irish and European prices as supply shortages emerge across the continent.

“Many of the increases we saw (here) over the last two months were in the 1 to 2c per litre range. Given that Irish prices were at the lower end of the European milk league for July, — even after some processors had increased their price — Irish milk co-op purchasers will have to look seriously at increasing prices,” said ICMSA dairy chairman Gerard Quain.

“Wholesale prices have picked up recently due to increased demand from Europe as the dry weather has affected key EU member states. This is reflected in the ongoing strength of Dutch dairy quotes and other European quotes which are returning almost 35c/l for the Butter/SMP mix and 32.5c/l for WMP,” said Mr Quain. 

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“Another key indicator is that demand for SMP intervention stocks picked-up significantly in the most recent tender with just under 31,500 tonnes sold, showing that there is demand in the market for powder and confirming that resilience demonstrated in recent months.”

The market could be described as ‘positively steady’ and this should be reflected in August milk price returned to the farm gate.

“ICMSA always believes that the Ornua PPI is the minimum starting point for all price announcements

and that’s the base on which we’ll be looking at price announcements for August milk over the  coming weeks”, he concluded.

IFA dairy chairman Tom Phelan said that  with “farmers   spending massively more this year on feeding animals, they  need co-ops to pay as much for milk as markets allow.”

Feed Bills

Processors should now give a firm commitment on the milk price until next spring at a minimum.

“The significant 3.1pc downturn in Irish supplies for July reflects the drought which has affected grass growth and milk output growth dramatically and influenced market sentiment positively with market average, spot and future quotes improving for most dairy products including SMP,” said Mr Phelan.

The anticipated rise in the August milk price will come as a massive relief to dairy farmers in the drier regions of the south and east who are feeding up to 9kg of feed per cow per day which at current prices equates to a feed bill of around €225/day for a 100-cow herd.

Online Editors