‘All co-ops should increase the July milk price’
Co-ops are being urged to follow the lead set by Glanbia and Lakeland Dairies and up their July milk prices by at least 1c/L by the Irish Farmers’ Association’s (IFA’s) Dairy Chairman Sean O’Leary.
There is scope and justification for the increase based on current market returns and the positive market outlook, O’Leary said.
An increase is justified alongside factors such as strong butter prices, the downward trend in EU production as well as recent Global Dairy Trade (GDT) and Purchase Price Index (PPI) results – which have been positive or stable, he added.
O’Leary said the IFA is calling on co-ops to work harder to pass back as much of the dairy upturn as possible to farmers, who have had to deal with two years of challenging cash flow and still have some way to go to rebalance their farm finances.
“Every additional cent co-ops can pass back to farmers as early as possible will make a vital contribution to their financial situation, allowing them to catch up with repayment commitments, including their merchant credit debt to the co-op.
It will also be due recognition for the commitment made by farmers to SDAS (Sustainable Dairy Assurance Scheme), which co-ops owe them to leverage into better markets and prices.
“While co-ops may still be dealing with some contracts signed at lower price levels, those are progressively being replaced with contracts which co-ops must ensure reflect the current stronger price indices,” O’Leary concluded.
Last week, both Glanbia and Lakeland Dairies decided to up their milk prices by 1c/L, to 34c/L including VAT, for milk manufactured in July. Other processors are expected to announce their July milk prices in the coming days.