Lakeland Dairies has become the first processor to reveal its milk price for the month of March, revealing a sharp drop from February.
In the Republic of Ireland, a price of 30c/L including VAT and lactose bonus will be paid for milk supplied in March.
Commenting on the price, Lakeland Dairies said the fallout from the Covid-19 is having a dramatic impact on the dairy markets.
“As the Covid-19 pandemic has continued across the globe the global dairy markets have collapsed.
“The food service sector across Europe has suffered near wipe-out following the closure of restaurants, cafes, hotels, while airlines have grounded many planes. Food service is an important route to market for Lakeland Dairies and many dairy processors across Europe.
Prices for butters, powders and cheeses are under significant downward pressure as food service milk is now flooding into powders and butter.
“Closer to home, sales of fresh milk and butter in retail outlets have increased somewhat but this increase has not offset the drop off in sales in the food service market.
“Reports from the UK and the US where farmers have been forced to dump milk as a result of a fall-off in demand, mainly in the food-service sector, has had a serious negative impact on the market.
“The markets are difficult at present and Lakeland Dairies will continue to monitor developments closely in the coming days and weeks.”
Ornua PPI down for March
The Ornua Purchase Price Index (PPI) has dropped for the month of March, due to a sharp fall in product returns, according to the company in a statement yesterday, Wednesday, April 8.
The PPI index for the month is 106.4 and is well down from the 111.6 figure (converting to 33.7c/L including VAT) recorded for February.
A spokesperson for the Irish dairy exporter explained that the reduction is due to sharp fall in powder and butter returns, coupled with stable cheese returns.