Milk price increase to 33c/L ‘effectively a month late’

The decision by some processors to up their June milk prices to 33c/L has been described as “effectively a month late“, by the Irish Creamery Milk Suppliers Association’s (ICMSA) Gerald Quain.

Quain, who is the Chairperson of ICMSA’s Dairy Committee, welcomed the announcement from a number of processors that they intend to pay 33c/L, VAT inclusive, for June supplies.

However, this price could and should have been paid for milk manufactured in May, Quain said.

He noted that dairy returns had “remained constant” right throughout June with the exception of butter – which was still on an upward trajectory.

Quain said: “The feedback the ICMSA is receiving from its members is that they feel that the appropriate price rise due in May was actually ‘held back on’ by the processors at that stage; that now needs to be rectified by meaningful increases for both June and certainly July supplies.

“The ‘low and slow’ approach to passing back better milk prices and timely upwards adjustments of the Ornua index had to end.

Executives and boards would want to finally recognise that farmers can read and follow the data – just as easily and accurately – as the co-ops and processors themselves can.

Milk price increases

Last week, Kerry joined Glanbia Ireland and Lakeland Dairies in announcing its decision to up its milk price to 33c/L, including VAT, for June milk.

This represents an increase of 1c/L from each of the processors, when compared with the milk price they offered in the previous month.

Prior to announcing milk price increases – of 1c/L – last month for milk manufactured in May, these processors had held their base price at 31c/L for three months in a row.

Other processors are expected to announce their June milk prices in the coming days.

Ornua also announced an increase in its Purchase Price Index (PPI) for the month of June, with a value of 110% given late last week.

The PPI rose from 106.8% for the month of May; a jump of 3.2 percentage points. This is the second consecutive price increase from April’s value of 105%.