Debate begins over Dairygold milk contracts
Dairygold Co-Op has denied that its milk supply contract, which is due to come into force next year, is creating unrest among its suppliers.
The contract, which was distributed to more than 3,000 dairy farmers in the past fortnight, runs from January 1, 2013 to December 31, 2019.
It is understood that some farmers have taken issue with several facets of the agreement, including the 2c/l milk price penalty that will apply from April next year to farmers who do not sign the contract.
However Tim Healy, head of Dairygold Food Ingredients, insisted that suppliers had received the contracts positively.
"Dairygold is one of the first processors to have published proposals to accommodate supply post-quota and we are satisfied that agreement signing is in full flow at this point," he told the Farming Independent.
"Hundreds of suppliers have already returned signed agreements," he added.
The contract requires farmers to forecast their milk production volume 24 months ahead, which the co-op says is essential to allow it invest in expansion and market development in line with anticipated milk flow.
IFA dairy chairman Kevin Kiersey said a number of farmers had expressed concerns to him on aspects of the proposed Dairygold contract.