Milk price boosts welcome: Glanbia bonus ‘particularly impressive’

Reacting to Glanbia Ireland’s decision to increase its milk price and add a 1c/L bonus, the Chairperson of the ICMSA’s Dairy Committee, Gerald Quain, said that it was welcome acknowledgement of the underlying strengths of dairy markets – both presently and into the medium term.

Quain said that in the same way as his organisation was never reluctant to criticise processors for “slow and low” payments, the group feels obliged to acknowledge Glanbia Ireland’s commitment to their suppliers – demonstrated, particularly, in the decision to pay the 1c/L bonus on January to June supplies.

The chairman added that as the largest processor in the state, Glanbia had now effectively signposted the road that other processors must follow if they are to show similar determination to pass back the benefits of strong and strengthening markets.

Quain also noted that Lakelands has raised its price for August milk to 35.5c/L and he welcomed the signs that Irish processors are finally moving to pay the kind of milk price that should see Ireland moving decisively up the EU Milk Price League, from our present lowly 12th position.

Meanwhile, these increases will bring the base milk price paid to Glanbia suppliers to 35c/L including VAT for milk produced in the eighth month of the year.

This is the fourth consecutive monthly increase of 1c/L announced by Glanbia. Prior to increasing its May milk price, the processor had held its price at 31c/L including VAT for three months in a row.

Commenting on the increase, Glanbia Ireland Chairman, Henry Corbally, said: “While the short-term outlook remains positive, we note that the current high prices are leading to higher production in key regions and may affect demand when fully passed through the supply chain.

Exchange rates, particularly the weakening dollar, may also have an impact on returns in the medium term. The board will continue to monitor market developments on a monthly basis.

The decision to issue a 1c/L bonus on all milk supplied in January to June of 2017 is set to be included in this month’s milk payment.

Milk volumes allocated to Glanbia’s Fixed Milk Price Schemes will also benefit from the flat 1c/L bonus payment.

Corbally added: “As a business majority owned by our farmers, we are always committed to returning the highest possible milk price to our suppliers.

“We are pleased that the business is in a position to make this very significant payment to our farmers for all milk supplied in the first half of this year.”