Lakeland cuts milk price, but 'balances' price with 2.5c/L support payment

Lakeland Dairies group CEO Michael Hanley .
Lakeland Dairies group CEO Michael Hanley .

Margaret Donnelly and Louise Hogan

Lakeland Dairies has cut its March milk price by 2.5c/L, but announced that it will "balance a reduction in the March milk price with a payment to support milk producers during the current very poor milk production conditions caused by bad weather and the fodder crisis".

Ahead of announcing the March milk price, Lakeland Dairies Chief Executive Michael Hanley said the basket is returning far less than 30c/L.

“That is with butter prices not far off €5,000/t but the skim market is 5-6c/L under intervention price which is very concerning,” he said.

“The overhang in the market place is a major negative shadow.”

Since late 2017, global market conditions have become very difficult with a significant drop in the returns available across various product categories and most notably skim milk powders.

Taking all of the various factors into account, Lakeland Dairies has reduced is base milk price by 2.5c/L for March but has offset this reduction through the payment of 2.5c/L support for all March supplies.

It says that this maintains the effective milk price payout for March at 34.56c/L including VAT and lactose bonus.

The co-operative announecd that it is also continuing to provide fodder at cost to milk producers along with ongoing nutritional advice and assistance in this difficult period. 

Get the latest news from the Farming Independent team 3 times a week.

Online Editors

For Stories Like This and More
Download the Free Farming Independent App