Downwards trend continues as Lakeland lowers milk price

Lakeland Dairies has become the third processor to announce a drop to its milk price for February supplies.

The co-op’s board announced today that the milk price will be reduced by 1c/L to 34.56c/L (including VAT and lactose bonus) for February.

The reduction in the base milk price “reflects extremely challenging market conditions including lower returns for powders and butter in recent months”.

Lakeland Dairies is very much aware of the difficult conditions faced by milk producers during the past month and the supported February milk price is designed to acknowledge these difficulties as best as possible in line with overall difficult market conditions, according to the co-op.

Last month, Lakeland suppliers received a base price of 35.5c/L including VAT, having withdrawn the 1c/L butter bonus which has been paid monthly from September to December inclusive.

This announcement follows on from the news, yesterday and today respectively, that Glanbia and Kerry have made similar price cuts to supplies.

Yesterday Glanbia Ireland announced its decision to cut its milk price for February supplies and pay its milk suppliers 32c/L including VAT for February manufacturing milk supplies at 3.6% butterfat and 3.3% protein.

This is a reduction of 3c/L from the January price.

The Glanbia February milk payment will also include a payment of 1c/L “to reflect the particularly challenging weather conditions experienced on Glanbia farms”.

Meanwhile, this morning, Kerry Group announced its decision to introduce a price cut of 2c/L – VAT inclusive – for February supplies, paying farmers a total of 34c/L.

This brings to an end five months of holding the previous milk price of 36c/L.

Last month’s price was not supported by actual demand in the marketplace, according to Kerry Group chief executive Edmond Scanlon.

Scanlon made the comments when presenting the group’s preliminary financial results last month in Dublin.