Tirlán to pay 40.08c/L for April milk
Tirlán will pay 40.08c/L (including VAT) for April milk after stopping the payment of its Agri Input Support Payment of 6.5c/L.
The April milk price consists of a base milk price of 39.58c/L (including VAT) and a sustainability action payment of 0.5c/L (including VAT) to all qualifying suppliers.
The base price and the sustainability action payment will be adjusted to reflect the actual constituents of milk delivered by suppliers.
The Tirlán total price for April creamery milk, based on LTO constituents of 4.2pc butterfat and 3.4pc protein, is 43.55c/L cpl (including VAT).
The processor said its board "made a commitment that the Agri Input Support Payment of 6.5c/L would be paid on all milk volumes, including all volumes in fixed milk price schemes, until the end of the first quarter of 2023."
"In that announcement, it was highlighted that the payment was subject to dairy markets continuing to perform at current high levels and input prices remaining elevated.
"In light of current dairy market returns, the board believes that it is appropriate to discontinue the payment at this time."
Higher interest rates are impacting on working capital costs in the supply chain and are dampening demand in some regions, according to Tirlán Chairman, John Murphy.
"Global milk supply has risen slightly but is expected to remain on a par with last year’s levels.
"There have been some very tentative signs of markets bottoming out, albeit at low price levels," he said.
It comes after Dairygold also reduced its milk price for April supplies by 2c/L to 40c/L this week.
A spokesperson for the processor said there continues to be weakness in global dairy ingredient markets which is "driven by a reduction in demand in certain markets and products driven by previous high prices.”
"There are some indications that markets are stabilising but it remains to be seen if this is sustained across peak supply."
Lakeland Dairies was the first to cut its April milk price when it announced a reduction of 4c/L last week.
In the Republic of Ireland, it will pay 38.85c/L, inclusive of VAT, for milk at 3.6pc fat and 3.3pc protein.
“The balance of global supply and demand remains outweighed by a stronger level of supply with reduced market returns, a continuing factor based on modest demand from buyers,” it said.
“The overall inflationary climate continues to affect consumer sentiment and buying patterns."