With co-ops set to reveal their milk prices for July supplies over the course of next week, the Irish Farmers’ Association (IFA) is arguing that there is scope to increase prices further.
“Co-ops have the opportunity to pass back more of the continued improving market value which has followed the end of lockdown and the increase in food services and international trade over the course of the last three to four months,” said Tom Phelan, the association’s Dairy Committee chairperson.
He argued that “at least some” of the co-ops have room to increase prices by 1c/L for July milk.
“[The GDT index] concerned almost only Oceanian product, much of which is as yet unproduced in the first month of the season, and takes place in the slowest month in the trading calendar,” he said.
The IFA dairy chairperson went on to say: “Meanwhile, European average butter prices rose €50/t during July, with powder prices relatively stable after a good recovery from their April and May lows.
“Spot quotes for butter have stabilised in recent weeks at €800/t above where they were in mid April, with SMP [skim milk powder] spots €250/t higher over the same period,” Phelan added.
International milk price comparisons also show that Irish milk purchasers perform below par.
Phelan cited the the LTO/ZuivelNL Monthly Milk Price Review of European processors, saying: “June 2020 shows the three participating (Irish) processors – Kerry, Dairygold and Glanbia – came in at €1/100kg (for Kerry) and €2/100kg (Dairygold and Glanbia) below the average for the main European processors.”
The GDT index plummeted following the conclusion of the latest auction, to mark back-to-back drops.
The most recent tender – event 265 – took place this week, on Tuesday, August 4, with the GDT Price Index down 5.1%.
Lasting two hours and 29 minutes, today’s event saw 164 bidders participate across 19 rounds with 132 winning bidders recorded.
A total of 32,696MT of product was sold on the day.
- AMF index up 3.0%, average price US$3,994/MT;
- Butter index down 2.8%, average price US$3,438/MT;
- BMP index down 6.5%, average price US$2,259/MT;
- Ched index down 5.3%, average price US$3,568/MT;
- LAC index up 5.7%, average price US$1,349/MT;
- SMP index down 4.6%, average price US$2,583/MT;
- SWP index not available, average price not available;
- WMP index down 7.5%, average price US$3,003/MT.