Glanbia milk price move leaves farmers unaffected – in the short term
IFA National Dairy Committee Chairman Sean O’Leary said that the 2c/l milk price cut announced by Glanbia in recent days, offset as it was by an equivalent 2c/l from the GIIL Milk Price Stability Fund, would leave dairy farmers’ pockets unaffected for their August milk supplies.
This, he said, is not insignificant in that August milk production had been very strong, and an unchanged payment to farmers at a time of weaker markets would make an important cash flow contribution.
Latest figures from Glanbia Ireland Ingredients limited (GIIL) show that as of August 23 it is 6.5% or 46 million litres over quota. In its latest milk quota update as of August 23 it also outlines that Premier is also some 5.2% or 7.5 million litres over quota.
Glanbia commented that supplies were again very strong in August continuing the year-to-date trend. Since January Glanbia and Premier’s combined milk intake is now 5% or 40 million litres ahead of last year.
However, O’Leary said Glanbia farmers would be very mindful of the fact that their base milk price is now 2c/l down at 31.4c/l + VAT (33c/l incl. VAT), and that the contribution from the Milk Price Stability Fund originates in the accumulated 2013 profits which could have been, but were not passed back to farmers in real time last year.
Mr O’Leary renewed his call on all Irish co-ops to remain resolute in the face of the current temporary market uncertainty, and to be judicious in their milk price decisions to avoid damaging farmer confidence and excessive pressures on their cash flow.