With co-op boards set to decide milk price for February in the coming days, the chairperson of the Irish Creamery Milk Suppliers’ Association’s (ICMSA’s) dairy committee, Ger Quain, has said that “there is justification for a price rise”.
Quain said: “Examination of the figures and market returns shows room for a milk price increase on February supplies and it is absolutely essential that this is delivered for farmers.
“Most Irish processors are paying less than 32c/L and with the Ornua index at 33.7c/L just on that basis there is quite clearly ample room for a milk price increase based on market returns.
The LTO milk league shows that the Irish processors still occupying three of the bottom four positions while also paying a milk price below what Fonterra in New Zealand is paying.
Continuing, Quain said: “If milk processors in other dairy producing regions can return a higher milk price, there is absolutely no reason why our processors cannot follow suit as they are all selling into the same markets and we should be obtaining a grass-based premium.
“There is uncertainty at present with coronavirus but quite clearly a lot of product has been forward sold and this should not impact on milk price.
“Global milk supplies are expected to grow by no more than 1% in 2020 while demand is expected to grow in the range of 1.5-2% so the market should be in a fairly positive position despite the current uncertainties with coronavirus.”
Concluding, the ICMSA’s dairy chairperson said: “The overwhelming evidence points to farmers being fully justified in seeking a February milk price increase from their co-op boards.”