Glanbia has announced that its milk price for member suppliers has increased to 47.08c/L (including VAT) for March 2022 creamery milk supplies at 3.6% butterfat and 3.3% protein.
This includes a base milk price for March of 46.58c/L (including VAT), which is an increase of 5c/L from the February base price of 41.58c/L (including VAT), the company said in a statement.
However, a seasonality bonus that the co-op was paying to suppliers over the winter months has now ended.
Meanwhile, the sustainability action payment of 0.5c/L (including VAT) is being paid monthly on all milk supplied in 2022 to recognise specific on-farm sustainability actions undertaken.
The base price and sustainability action payment will be adjusted to reflect the actual constituents of milk delivered by suppliers.
The Glanbia milk price for March creamery milk, based on standard European constituents of 4.2% butterfat and 3.4% protein, is 48.95c/L (including VAT).
Glanbia Co-op chair, John Murphy said:
“Dairy market prices are now at unprecedented highs, with global milk flows likely to be weaker in the first half of this year.
“We are in unchartered territory as rising costs and tight supplies of key farm inputs such as feed and fertiliser contribute to the current strength in dairy prices on global markets.
“However, we note that the current strong inflationary period may impact on consumer demand. The board will continue to closely monitor developments.”
Stability fund
He said that the board is acutely aware of the increased level of risk in this inflationary environment.
“And, we want to ensure that we have adequate provision to protect both suppliers and our farmer-owned business for the future.
“Consequently, the board has decided that from April onwards we will gradually create a stability fund to help protect against any sudden change in market dynamics.”
Fixed milk price scheme
The Glanbia Co-op chair also reminded milk suppliers that Phase 18 of the Glanbia fixed milk price scheme is currently open for applications.
“The latest phase of our scheme provides an option to deliver an element of security at a strong price compared to historical norms.
“This three-year scheme sets a base milk price of 42c/L, 40c/L and 40c/L for 2022, 2023 and 2024, plus constituents and any applicable bonus payments,” he said.
There is also a new feed-price adjuster to help protect against input-cost volatility, he said, adding:
“It should be considered by suppliers as an option to mitigate against the risk of any future change from current market dynamics.”