‘Substantial’ 3.5c/L price gap between top co-ops for July

The chair of a leading creamery lobby group has expressed hope that some of the current positive market sentiment will translate into better farm gate prices.

Following a lift in the July milk price from a number of processors, chairperson of the Irish Creamery Milk Suppliers’ Association’s (ICMSA’s) Dairy Committee, Gerald Quain, has said he “wholeheartedly welcomes” the news of a milk price increase.

Quain noted that Lakelands, Kerry, Aurivo and individual co-ops in west Cork had all raised their prices for July milk; but he added that farmers’ attention would be focused on “very substantial discrepancies” that existed between the final prices of those co-ops.

He highlighted that Lisavaird are paying over 35c/L, while Aurivo are at 31.5c/L.

He remarked that this is a “substantial” price gap.

While the ICMSA acknowledges that co-ops are paying a rising price; the farm lobby group said it will “always stress that the Ornua PPI is the minimum price that should be returned”.

‘Make Or Break’

Looking at current wholesale markets, Quain said they showed that Dutch dairy quotations have reached higher levels across most categories this week again – with butter fetching over €5,500/t after slipping back last month.

The standard butter/skim milk powder (SMP) mix is equivalent to 34.1c/L when translated back to farm gate price.

Quain concluded by warning that 2018 costs have doubled as a result of the long winter and summer drought.

“This has exerted pressures on every dairy farmer in the country and co-ops will have to understand that many suppliers are going to be at make-or-break levels this winter and milk price will decide the issue either way.”