Farming organisations have welcomed this week’s announcement that Kerry Group and Kerry Co-op have reached agreement on the long-running 2021 leading milk-price issue.
In a joint statement issued on Wednesday (April 13), it was confirmed that Kerry milk suppliers will get a payment of 0.85c/L on all qualifying 2021 milk volumes.
Kerry Group outlined that this is “in satisfaction of our contractual commitment to pay the leading milk price on a like-for-like basis”.
It is expected that this payment will be included in the March milk cheques.
In addition, the processor confirmed that it will pay 0.85c/L on all 2021 forward-price-scheme volumes in “recognition of the challenging inflationary conditions at farm level”.
As previously reported by Agriland, chair of Kerry Co-op, Denis Carroll, said that the 2021 milk price would need to be resolved before any talks on a potential dairy-business joint venture with Kerry Group take place.
Arbitration is still ongoing on outstanding leading milk-price issues.
Chair of the Irish Creamery Milk Suppliers’ Association (ICMSA) Dairy Committee, Noel Murphy, welcomed this week’s “very positive” announcement.
“It’s a good development and it augers well for the future, and hopefully both parties can work constructively together.
“It’s been an ongoing saga with the last number of years and at least 2021 being resolved demonstrates both parties’ willingness to work together and resolve issues,” he told Agriland.
“From what I am hearing, farmers are welcoming it. It’s a difficult enough year with costs and everything and farmers welcome any extra top-up that they can get,” he said.
The ICMSA Dairy Committee chair previously called on all milk processors to pay a 50c/L base price to suppliers.
Murphy estimated that rising input costs have driven the cost of milk production up to around 40c/L, which is an increase of approximately 10c/L compared to last year.
Meanwhile, the Irish Farmers’ Association (IFA) Kerry chair, Kenny Jones, also welcomed the announcement.
He told Agriland that the feedback from farmers he has spoken with has been positive. “They seem happy enough,” he said.
The Kerry IFA chair noted that the extra financial boost is timely as farmers continue to deal with rising input costs.