The chair and a number of members of the Kerry Co-op board will take part in a protest over milk prices outside Kerry Group’s Charleville milk processing plant tomorrow (Tuesday, June 20).
The protest has been organised by a group of milk suppliers who want Kerry Group to bring the price paid to suppliers “into line with other processors”.
The board of Kerry Co-op held a meeting today (Monday, June 19) and agreed to join the protest over the “poor milk price paid by Kerry Group plc to Kerry milk suppliers”.
According to the board the current price is now “3c/L behind the price being paid by neighbouring processors and is at the bottom of the 2023 milk price league”.
Denis Carroll, Kerry Co-Op chair, said: “Kerry Group Plc needs to empathise more with milk suppliers and maintain its monthly milk price consistent with its commitment to paying the leading milk price.
“Failure to do so monthly only damages the relationship between suppliers and the plc. The gap in milk price will have to be compensated for, when the leading milk price commitment is determined.”
Kerry Group
Last week Kerry Group said it would pay suppliers a base milk price of 37c/L, including VAT, for milk at 3.3% protein and 3.6% butterfat.
This represented a drop of 1c/L by the processor from the base price of 38c/L for April supplies and equates to 40.61c/L including VAT at EU standard constituents 3.4% protein and 4.2% butterfat.
According to Kerry Group, based on its average milk solids for April, the expected average milk price return inclusive of VAT and bonuses is 39.09c/L.
The group has blamed “significant demand uncertainty” on global markets for the decline in prices
But Conor Creedon, Kerry Co-op’s vice chair and chair of the society’s leading milk price committee, said last week’s price reduction was “especially frustrating as the month of May represents peak milk production when some 16% of milk is produced”.
Creedon also said that Kerry Co-op is “determined to rectify this” and that Kerry Group will “have to stand by the leading milk price commitment that it established with the suppliers some years ago”.
The confirmation by the board of Kerry Co-op that they will support Kerry milk suppliers at the protest tomorrow has been welcomed by some farmers.
However, there are others who believe that the Kerry Co-op board has “failed” to represent shareholders and farmers on milk price.
Some farmers have told Agriland that there is a group that no longer wants the Kerry Co-op board “representing” them on milk price negotiations.
According to this group farmers believe that the “relationship” that exists between the board of the co-op and the board of Kerry Group is “not working” for milk suppliers.
It said it is frustrated by the decline in the price paid by Kerry Group to suppliers and believe that farmers are “losing out” to the Kerry Group.
One farmer told Agriland today (Monday, June 19) that there is no recognition from Kerry Group that the cost of production “remains high”.
“Farmers were able to cope with high costs last year because of the milk price but that is not the case this year,” he said.
According to the dairy chair of the Irish Farmers’ Association, (IFA) Stephen Arthur, an average Kerry milk supplier – milking 90 cows – received about €2,000 less for their May milk when compared with other milk processors.
“For many Kerry milk suppliers this is below their cost of production given the massive cost increases and the difficult spring weather they have endured,” Arthur warned.
He said Kerry is now “lagging significantly on milk price compared to other processors” and said that the group needs to rectify this if is going to live up to their promise to “pay the leading milk price on a like for like basis”.
“We are calling on Kerry Agribusiness to commit to addressing this widening gap with a significant supplemental payment in the June milk payments,” Arthur said.