Milk processors urged to invest in suppliers as well as 'stainless steel'
Milk processors have been challenged to 'invest' in their suppliers this spring to the same extent as they have in stainless steel over recent years by holding March milk prices.
IFA dairy chair Tom Phelan said dairy farmers were currently facing "massive challenges to their economic sustainability" and he urged creameries not to repeat February's heavy milk price cuts.
"Co-ops have been lecturing farmers about sustainability: now they must ensure that sustainability is also about the economic viability of dairy farmers," Mr Phelan insisted.
He said an intensive lobby of processor and co-op board members was being undertaken by the IFA to try slow down the pace of price reductions.
Base milk prices for February were cut by between 1c/l and 3c/l as a result of what processors described as challenging marketing conditions. The dairy industry claim market returns equate to a milk price of 28-30c/l.
Returns to farmers are generally around 33-34c/l, although Aurivo paid 35.58c/l for February supplies, with Lakeland Dairies on 34.56c/l.
While the IFA did not single out any processor, the decision by Glanbia to reduce its base price for February by 3c/l - and returns to its suppliers by 2c/l - provoked surprise and anger among many dairy farmers.
"The milk price decisions some co-ops took for February milk have shown just how out of touch they are with the massive challenges to their economic sustainability that suppliers have been experiencing for the last number of months," said Mr Phelan.