The Lakeland Dairies board has confirmed its August milk price.

The processor will pay a base milk price of 39.1c/L (based on standard constituents of 3.6% butterfat and 3.3% protein) including VAT for August milk in the Republic of Ireland.

Lakeland said this is inclusive of the 0.5c/L Sustainability Incentive Payment.

The milk price for August marks an increase of 0.6c/L on July.

The average payout will be 44.7c/L, Lakeland told suppliers.

In Northern Ireland, a base price of 31.4p/L will be paid for milk supplied in August which is also inclusive of the Sustainability Incentive Payment.

This is an increase of 0.5p/L.

Lakeland is the first processor of the month to announce its milk price.

Global milk production

A Lakeland spokesperson said the market continued to improve throughout the month.

"Global milk production remains high but the rate of growth is slowing," Lakeland said.

"This will help to bring a better balance between supply and demand in the months ahead.

"Lakeland Dairies will continue to monitor the markets and will endeavour to support our farmers with the best milk price possible in line with market conditions."

Ornua PPI

In other dairy news, the Ornua Purchase Price Index (PPI) has increased for the month of August, while the resulting indicative milk price return has remained unchanged.

The Ornua Monthly Purchase Price Index (PPI) for August is 130.4, up from the previous month at 130.2.

After deducting estimated processing costs, Ornua's PPI implies an indicative return of 36.2c/L, inclusive of 4.5% VAT, for milk at 3.6% fat and 3.3% protein.

This price is unchanged from the indicative return for July.

Ornua said the index increase and unchanged milk price "reflects stable market returns for the month of August".

Processor estimated costs for August were reckoned at 10c/L.

The estimated processer costs are based on Ornua’s estimate of the average cost of processing the Ornua 'basket of products', which Ornua said is not representative of any individual member co-op processor.