With processor milk quotes due to be confirmed over the coming days and weeks, one farm organisation is calling on them to offer “a minimum” of 55c/L.
The Irish Creamery Milk Suppliers’ Association (ICMSA) said that dairy markets continue in a very strong position.
However, the returns being achieved at milk processor level “are still not being fully reflected in the price being paid to farmers”, according to ICMSA Dairy Committee chairperson Noel Murphy.
“While we acknowledge that milk prices are at record levels, we also point to record high input costs.”
Speaking this afternoon, Murphy said: “While revenues are strong, the bills to be paid are unfortunately larger.
“The co-ops must know that’s why it’s so important that every cent that can be returned to their suppliers is passed back,” he added.
“In our opinion this means that for milk supplied in June, farmers should be paid, as a minimum, 55c/L,” Murphy argued.
He also noted that the Ornua Purchase Price Index (PPI) converts to a price that is in fact ahead of this figure, reflecting a value of 56c/L.
Meanwhile, Dutch dairy quotations are currently over 60c/L.
“A price of 55c/L is not an unreasonable request and is fully justified by marketplace developments,” The ICMSA dairy chair remarked.
“Farmers are being ravaged by rocketing input cost bills that have been building up since the start this year,” he stressed.
Murphy concluded: “Farmers have to get every cent that their milk is fetching in these continually climbing markets.”
On the dairy markets front, the news has been somewhat mixed this week.
As mentioned, the Ornua PPI for June is 179.4, an increase of just under one point from the May value of 178.5.
This most recent PPI figure reflects a price of 56c/L, inclusive of VAT, based on Ornua’s product purchase mix and assumed member processor costs of 8.3c/L, though excluding member margins.
However, the Global Dairy Trade (GDT) index went in the opposite direction.
The GDT price index dropped by 4.1% following its latest trading event this week.
It marks the second consecutive fall in the index; there was a 1.3% drop following the previous auction on June 21.
The index, which hit a record high of 1,593 on March 1, now stands at 1,287 as a result of trading event 311.