The IFA has said that it urged Glanbia to pay its milk price top up to all producers at a meeting last week with the Chairman and CEOs of Glanbia Plc and Glanbia Ingredients Ireland (GII).
IFA National Dairy Chairman Sean O’Leary said the IFA delegation pressed Glanbia very strongly on the issue the 0.5c/l co-op top up co-op patronage bonus, which offsets much of the September price cut. Urging them to reconsider their approach: paying it to all producers regardless of whether they have signed the MSA would be a fairer approach and would help farmers feel less pressurised.
“For farmers, the prospect of making investment and managing their business into the unknown of the post quota era is daunting enough. Glanbia suppliers are understandably wary of some of the changes they are being asked to take on board, including the Milk Supply Agreement,” he said.
The IFA delegation – also included IFA President Eddie Downey, Liquid Milk Chairman Teddy Cashman and Waterford Dairy Chairman Joe Harty – stressed that farmers needed reassurances that the GII joint venture model will return sustainable milk prices to farmers into the future.
“While we acknowledge that Glanbia have committed to holding the current price to year end, the extreme cut to 30.5c/l for September milk came as a shock to milk producers. They felt Glanbia were again using their early price setting mechanism to drive down all milk prices to a greater degree than September market returns warranted,” President Eddie Downey said.
“IFA recognises that the turbulence of international dairy markets will likely lead to a number of months of poorer returns before markets recover. However, farmers expect their milk purchasers to support them through this difficult time as we face into the post quota era. Glanbia needs to do more to reassure farmers that the GII JV model is fit for purpose and not relying on low producer milk prices to meet its financial commitments. Glanbia must also convince farmers that the combination of a viable base milk price added to other elements such as co-op top ups, stability funds and fixed margin contracts, will leave Glanbia suppliers with a strong milk price which reflects the strength of their milk processor and the efficiencies secured from a massive capital investment in all processing sites,” he said.