The Ornua Purchase Price Index (PPI) has increased to 125.8 in November 2023, with the latest figure being announced today (Wednesday, December 6).
The increase follows a previous rise to 122.3 in October, which was the first rise after nine consecutive months of decreases in the PPI.
With estimated member co-op processing costs of 7.6c/L (excluding any allowance for processor margin) for the Ornua product portfolio, the indicative price return for November is 37.2c/L, including VAT.
Ornua PPI
This latest PPI for November is up from the previous month at 36.1c/L.
The energy cost element of the processing cost is variable and changes each month depending on energy costs.
In addition, the Ornua Value Payment payable to members for the month of November is €3.8 million, which equated to 6.4% of gross purchases in the month (4.8% year-to-date).
Ornua said that the latest PPI figure “reflects stronger market returns through the month of November 2023”.
Milk price
Earlier today, the Irish Creamery Milk Suppliers’ Association (ICMSA) has said that 37c/L is the minimum acceptable milk price for November supplies.
The chair of the association’s dairy committee, Noel Murphy said that milk processors must “wake up” to the reality currently facing their farmer suppliers.
Murphy insisted that November should mark the beginning of a series of milk price increases to be introduced in the coming months.
“The only surprise with the October milk supply figure being down 12.1% is that the reduction wasn’t greater.
“We anticipate November and December figures will be down even more as farmers, many of whom would normally milk over the winter, have taken the decision to dry off cows as it is simply not economically viable to continue to milk them,” he said.