Irish dairy processors should be able to afford holding milk prices until the end of 2019, according to the national dairy chairman of the Irish Farmers’ Association (IFA).
Tom Phelan was responding to the current state of European milk markets, particularly the recently quoted prices in the monthly review of European prices published by the Dutch agriculture federation LTO.
“Irish co-ops, which have been cutting milk prices in July to varying degrees and are busy talking them down further, are falling behind their European counterparts, many of which have held prices for some months, with plans to hold into September,” Phelan argued.
“With the exception of the West Cork Co-ops, Irish milk purchasers have paid farmers less than the Ornua PPI return for most of the last 11 months, and they can afford to hold prices at least till year end,” claimed Phelan.
He also highlighted other figures to back up his claim that Irish processors were “falling behind”.
“All European milk price indicators are showing stability. The EU average milk price published for July by the EU Milk Market Observatory (MMO) based on member states’ reports is €33.70/100kg,” he said.
Between June 2018 and June 2019, the average milk price reported by the EU MMO has increased by 4%, yet the Irish price by only 1%.
Phelan highlighted the European-wide trends among co-ops and processors.
“The main European milk purchasers have stabilised milk prices for some months now, with Dutch-based cross-border co-op Friesland Campina paying €35/100kg for July and August and continuing to hold for September,” he said.
“Arla UK is also holding its milk price for September, the 8th consecutive month, at 30.22p/L, with most other British milk purchasers also holding, in many cases continuing a trend several months long,” he added.
Concluding his remarks, Phelan said: “Brexit is a legitimate cause for concern, but Irish dairy farmers cannot be made to pay for it in advance.”