Following the recent publication of the January 2018 Ornua PPI and the series of January milk price announcements, milk price “can and must” be held at current levels, according to the Irish Creamery Milk Suppliers Association (ICMSA).
The chairperson of ICMSA’s Dairy Committee Gerald Quain said that the stability of the PPI index at 111.3 shows the improved resilience in dairy markets and demonstrates again ICMSA’s belief that current price levels can be maintained.
Quain said that all three GDT Auctions in 2018 have been positive; while Dutch dairy quotations firmed notably in recent weeks. He explained: “The 5.9% increase in the most recent GDT auction was achieved by increases in all products sold – with butter, SMP (skimmed milk powder) and WMP (whole milk powder) achieving over 7% gains.
European quotes for butter are holding strong and remain at a historically high level in the mid €4,000 per tonne range.
“Dutch quotations for the butter/SMP mix have rallied in the last four weeks; while WMP price has increased by over 2c/L since the start of the year – and has regained some of the ground lost in the run-up Christmas,” the chairman added.
Quain also noted that demand for dairy products is currently positive across Europe and globally, while the traditional link between strengthening oil prices and demand for dairy is still evident.
On the back of all this, Quain reiterated: “Processors and co-ops can – and must – hold milk price into the second quarter and towards our peak production.”