Increase to November milk price ‘warranted on its own right’
The increase to milk price for November supplies “was warranted on its own right”, according to the Irish Creamery Milk Suppliers’ Association (ICMSA).
Reacting to milk price announcements made so far, ICMSA dairy chairperson Gerald Quain said that farmers would feel that an increase to base price was warranted in its own right “as a recognition of the small degree of stability offered by the acceptance of the Irish Protocol last week”.
Quain said that while nobody imagined that November price was hugely significant in terms of revenue in the round of the year, it would serve as a realistic platform for price in spring 2021 – and those production months that were much more significant in annual income terms.
It seems obvious that milk purchasers are hedging on the results of the crisis EU-UK Trade talks – but the underlying picture is reasonably positive with a key indicator being supplied by Fonterra which has [narrowed and] raised its farmgate milk price range.
“There’s been an uplift of the Global Dairy Trade auctions as well as the ongoing strong performance of spot prices,” Quain said.
The chairman said he accepted that co-ops would be understandably nervous around the prospects for milk price, but he reminded everyone that farmer milk price was always a retrospective model:
“Farmer price is based on the prices the co-ops have already received.
Co-op nerves about what’s likely to happen should not affect them paying their farmer-suppliers a price consistent with the price the co-ops have already received for their product.
“Farmers cannot be paid for milk they supplied last month on the basis of what the co-ops fear might happen next month,” Quain concluded.