Glanbia Ingredients Ireland (GII) has launched two new Fixed Milk Price Schemes, offering milk suppliers the option to protect a portion of their milk supply from the extremes of market price volatility.
Glanbia has launched Phase 8 and Phase 9 of its Fixed Milk Price Scheme, with Phase 8 lasting for three years, while Phase 9 is a one year Fixed Milk Price Scheme.
According to Glanbia, the Phase 8 Fixed Milk Scheme will use a reference milk price of 30.10c/L including VAT, while Phase 9 will pay a base milk price of 31.75c/L including VAT.
Henry Corbally, Glanbia Chairman said that GII is acknowledged as a global leader in the development of market price volatility tools, having launched a scheme every year since 2011.
Over 1.7 billion litres of Glanbia milk supply has now been contracted through these Schemes.
These schemes are totally voluntary, but I am delighted that over 2,000 of our farmers now avail of the option to reduce milk price risk on a portion of their milk supply.
Sean Molloy, Director of Strategy and Supply Development with GII, said that the Schemes had proven very beneficial to participating milk suppliers in 2015 and 2016.
“The average price paid for milk in the Schemes in 2016 was 5.2c/L above the open market price,” he said.
“We will continue to explore innovative ways to help our milk suppliers and customers cope with market price volatility, which is particularly challenging for family farms,” he said.
Application forms for both Schemes will issue to all GII milk suppliers in early January and suppliers can apply to participate in one or both Schemes.
Glanbia also says that any support payment made by Glanbia Co-operative Society to its members will be paid on top of the fixed milk price.
According to Glanbia, in allocating available milk volumes, priority will be given to participants in Phase 3 and Phase 4 Fixed Milk Schemes.
However, some 10% of the available funding will be ring-fenced for new entrants. The remaining volume will be allocated to all other applicants, it says.