Dairy farmers are disappointed with the decision by Ornua to amend its Purchasing Price Index (PPI), according to the Irish Farmers’ Association (IFA) – which has called on the exporter to publish the index in the old format alongside the proposed new one “in the interest of transparency”.
Commenting today, Wednesday, July 15, following the approval by the board in Ornua to changes in calculating the PPI, IFA president Tim Cullinan said:
“In particular farmers can’t understand the increased allocation for processing costs, despite the investments made in modern processing facilities.
With over 50% more milk going through more modern plants, farmers cannot understand how costs are increasing when increased throughput should reduce them.
IFA National Dairy Committee chairman Tom Phelan also spoke on the matter, stating:
“It would also have made more sense to farmers for this decision to be considered by the new Ornua board due to come into office later this year.
“The onus is now firmly on Ornua to prove to farmers that this new format will continue to serve them as well as the previous version.”
The chairman highlighted that both the IFA and farmers in general value the contribution to market and price transparency that the Ornua PPI has made over the years.
Farmers fear that today’s changes may undermine the transparency of the index and its relevance to their milk price. Ornua must now come out and explain these changes to farmers, and prove to their satisfaction that it will continue to serve farmers well.
“In the interim, and in the interest of transparency, Ornua should continue to publish the index in the old format alongside the proposed new format,” he concluded.