'Sharp fall in market returns' drives Tirlán's September milk price down
Tirlán today (Monday, October 20) confirmed it will pay farmers 42.08c/L, including VAT, for September milk at 3.6% butterfat and 3.3% protein.
Tirlán's September milk price consists of a:
- Base milk price of 41.58c/L (including VAT), a reduction of 4.0c/L from August;
- Sustainability Action Payment of 0.5c/L (including VAT) to all qualifying suppliers.
The co-op has indicated that the base price and Sustainability Action Payment will "be adjusted" to reflect the actual constituents of milk delivered by suppliers.
According to Tirlán, the actual average price paid for September creamery milk, based on delivered constituents will be 53.79c/L including VAT.
The average price paid by Tirlán for August creamery milk, based on delivered constituents, was 54.1c/L including VAT.
Tirlán
John Murphy, chair of Tirlán, said today that global milk supply and milk solids "are tracking higher than expected with continued strong growth in September and October".
"European milk supply increased strongly from July into October on attractive margins and favourable weather.
"Unfortunately, milk supply growth is outpacing demand, which has weakened.
"Price for higher protein products, such as whey proteins, remain firm, but there have been sharp falls in the price of butter and cheese – two key products that are substantial drivers of milk price," he added.
The most recent Global Dairy Trade (GDT) auction reflected the latest trends in international markets.
Following the last auction event (Tuesday, October 7), the GDT index dropped by a further 1.6%.
This represents an average price of €3,921 per metric tonne (mt) of product sold.
The GDT price index has been falling since the August 19 trading event.
According to Tirlan's chair, the co-op "understands farmers’ disappointment at this sharp fall in market returns, which we are reflecting in lower farm gate milk prices".
"In Tirlán, we are committed to maintaining financial discipline in order that our co-op can continue to invest for long term growth and development on behalf of members.
“The board will continue to monitor market developments on a monthly basis," Murphy added.
