Farm Ireland

Thursday 18 January 2018

Farmers in south pay 20c/l for milk quota

Caitriona Murphy

Caitriona Murphy

A top price of 29c/l was paid in Callan Co-op for milk quota in the latest round of the Department of Agriculture milk quota exchange.

Demand for milk quota from Glanbia and Dairygold suppliers continues unabated, with a price of 20c/l recorded by both processors.

Industry sources said the exchange prices reflected an underlying confidence in the dairy business, despite last year's hike in costs and poor milk price.

The prices also confirm that many farmers aim to significantly expand milk production again this year, with those without sufficient quota to match expected output keen to limit their exposure to a possible superlevy fine.

This was seen in Glanbia where the number of potential quota buyers exceeded quota sellers by six to one.

This resulted in a 2c/l increase in the quota price compared to the December 2012 exchange.

In Dairygold, there were five quota buyers for every one quota seller but the price was unchanged from last December.

Milk quota for sale through Centenary also sold for 20c/l, with the number of buyers exceeding sellers by three to one.

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Neighbouring Tipperary Co-op was not far behind on an exchange price of 18c/l. Demand for quota in the West Cork co-ops was also strong, with prices of 17c/l paid in Barryroe and 14c/l paid in Drinagh.

However, Bandon suppliers had to fork out less, at a price of 12c/l. Farmers in Wexford paid 15c/l for quota, while Arrabawn and Connacht Gold suppliers paid 13c/l.

Where quota restrictions have not been a problem, farmers were less inclined to flash the cash.

Lakeland suppliers paid 11c/l, while Kerry farmers paid 10/c/l and Town of Monaghan suppliers were even more conservative, paying just 8c/l for quota.

In all, more than 27m litres of milk quota was offered for sale through this exchange, with almost 93pc (25.2m litres) successfully traded. Some 18.4m litres was sold at prices ranging from 5c/l to 29c/l and the remaining 6.8m litres were sold through the priority pool at the maximum price of 5c/l.

Minister for Agriculture Simon Coveney said the results of the exchange proved that sentiment in the dairy sector was extremely positive.

Irish Independent