Glanbia Ingredients Ireland (GII) has launched a new Fixed Milk and Feed Price Scheme with a base of 30.25c/L (including VAT) at reference milk constituents of 3.6% butterfat and 3.3% protein.

It says the voluntary Scheme runs for 18 months from January 2016.

For the first time, the Scheme also includes an optional feed element.

According to Glanbia the partnership between GII and Glanbia Agribusiness gives dairy farmers the option of fixing the price now for a set tonnage of Glanbia Agribusiness concentrate feeds for delivery and payment between August and December 2016.

However, GII also says that participating farmers can choose to fix their milk price without availing of the forward price option on feed.

The Scheme will be open to all GII suppliers in the Republic of Ireland that have signed a Milk Supply Agreement (MSA).

A supplier delivering milk with the Glanbia average constituents would receive a projected 32.53 cpl including VAT for milk in this Scheme.

Any support payment made by Glanbia Co-operative Society to their members would be paid on top of the fixed milk price.

Glanbia Consumer Foods (CFI) has also confirmed that it will be offering the same terms as GII for up to 10 million litres of contracted volumes at the Fixed Milk Price.

This would allow liquid producers to fix the base price of their contracted volumes at 30.25 cpl including VAT from January 2016 to June 2017.

All premiums paid as part of the three-year agreement between CFI and Fresh Milk Producers (FMP) are on top of the base price.

Ten million litres of the liquid milk pool is already in the 2015 Index-Linked Fixed Milk Price Scheme, Glanbia has said.

Glanbia chairman Henry Corbally said that this Fixed Milk & Feed Price Scheme is the latest in a series of volatility management tools from Glanbia.

He said that over 1 billion litres of milk has been sold by GII under fixed margin schemes since their launch as an industry first in 2011.

Also commenting on the scheme, Seán Molloy, Director of Strategy at GII, stated that the combination of a fixed milk and a fixed feed price Scheme offers suppliers an opportunity to protect a significant proportion of their margin.

Molloy recommended that suppliers who are interested in participating in the scheme should take the option that the scheme facilitates to lock in both the milk and feed price.

Full details of the Scheme will be made available to all milk suppliers in the coming weeks.