The Ornua Purchase Price Index (PPI) for the month of December is 173.4, up from 171.8 in the previous month.

The Ornua PPI is a monthly indicator of market returns on dairy products purchased by the dairy giant (typically butter, cheese, whole milk powder and protein products), relative to comparable returns generated in a base year (2010).

Estimated member co-op processing costs of 10.1c/L (excluding any allowance for processor margin) for the co-op’s product portfolio imply an indicative return of 52c/L, including VAT inclusive (flat month on month).

The energy cost element of the processing cost is variable and changes each month depending on energy costs, according to major co-op.

Value Payment

The Ornua Value Payment payable to members in the month is €2.9 million, which equated to 3.7% of gross purchases in the month (3.7% year-to-date).

Seasonally low purchase volumes in December mean lower market prices have not yet been reflected in the PPI, according to the dairy company.

On the basis of current spot pricing, and as the company’s trading volumes increase seasonally, declines in the PPI are expected over the coming months.

Ornua in court

Meanwhile, Ornua has initiated a trademark case in a US court over what it sees as an infringement of the Kerrygold brand.

Court filings show that Ornua Co-operative Ltd., and Ornua Foods North America are both listed as plaintiffs in the case, which is being heard by the the US District Court, specifically the Northern District of California.

New Zealand-based Westland Dairy Company Ltd., is the defendant. The case revolves around Westland’s Westgold butter, which Ornua claims infringes on the Kerrygold trademark due to the similarity in packaging.

Last Thursday (January 5) Ornua filed a motion for a preliminary injunction against Westland. It is understood that Westland has until January 19, to respond to this motion. A hearing on the motion is scheduled for February 9.