Milk Price Indicator to be reinstated in Northern Ireland
The decision has been made by the Ulster Farmers’ Union’s Dairy Committee to reinstate its Milk Price Indicator (MPI).
The MPI was originally launched in 2013, because of an absence of milk pricing data specific to Northern Ireland, according to the UFU.
Published every fortnight, with supporting market analysis, the farmers’ union believed it gave dairy farmers an indication of returns from key commodity markets.
The publication was suspended in late 2014 after claims it talked down milk prices, the UFU said
However, these claims were proved wrong when continued calculation of the MPI accurately reflected market returns and the milk price in Northern Ireland, the union added.
The reintroduction of the MPI will be a useful tool for both dairy farmers and processors going forward, UFU Dairy Chairman, William Irvine, said.
“It will give a broad indication about what the market can return, but it cannot provide an exact milk price figure.
In an era of volatility the reinstated MPI will however give farmers vital information about the direction of prices.
“It should be seen as ‘the canary in the coal mine’, alerting farmers to market trends and allowing them to plan their response,” said the UFU dairy chairman.
In the future the UFU MPI is set to be published every fortnight on a Friday, with supporting analysis, on the UFU website as well as in the UFU members’ bulletin.
The method in which the MPI is calculated will remain unchanged, as it is based on existing industry recognised market calculations, the UFU said.
These market calculations are AMPE (Actual Milk Price Equivalent) and MCVE (Milk for Cheese Value Equivalent), which are then adapted to analyse prices in local, European and global dairy commodity markets.
The MPI does not include processor margins or transport costs, according to the UFU.