Dairygold milk price cut 'totally over the top'
The Irish Farmers' Association (IFA) has described Dairygold's decision to cut milk price by 3c/L for August as "totally over the top".
The processor confirmed yesterday (Tuesday, September 17) that the August quoted milk price would drop to 45.0c/L.
This compares to a price announced last month for July milk of 48c/L.
Dairygold chairperson, Pat Clancy said that "there has been a dramatic deterioration in global dairy prices over the last three to four weeks".
He said that increased global milk supply and weaker consumer sentiment have seen key Dairygold products, especially butter and cheese, fall by well over 3c/L.
However, IFA Dairy Committee chair Martin McElearney has strongly criticised the milk price cut.
“We appreciate that butter markets are under pressure and global milk supply is up, but a cut of 3c/L was not expected and has left farmers frustrated and angry.
"For an average sized supplier, this equates to a cut of €1,600 for the August milk cheque.
"Global milk supply forecasts have been revised upwards in recent weeks, growing to 1.4-1.6%, which is indicative of ample supply,” he said.
"At the same time, the futures market for butter has declined to €5,600 – a drop of 11% in one week.
"However, the latest Global Dairy Trade (GDT) auction proved relatively stable, only dropping by 0.8%.
“Co-ops need to take a measured response to this correction in the marketplace.
"Knee jerk reactions undermine farmers’ confidence in our co-op structure.
"Co-ops must endeavour to return the best price to its suppliers and refrain from drastic cuts,” McElearney added.
