Carbery’s milk price for October has been further cut to an average of 42.6cpl, down 3.5cpl from September this year. 12 months ago, the average milk price was 51.75cpl; these figures are inclusive of VAT.

Dairygold has also dropped its price for October, to an average of 38.0cpl compared to 12 months ago, when it was 49.0cpl.

A spokesperson for Carbery claimed the drop was a result of very strong global supply, which ‘continues to outpace consumption’ and is therefore weakening prices.

‘While we will make every effort to pay the best price we can based on market returns, we will also prioritise business decisions that maximise shareholder value in other ways’.

Dairygold echoed that statement, that a strong global milk supply ‘continues to exceed demand’ and that the ongoing imbalance between supply and demand continues to impact butter, cheese, and milk powder for the ‘foreseeable future’.

The ICMSA described the milk price reductions as ‘horrendous’, downplaying the ‘supply versus demand argument’ and instead saying the price drop was a result of the existing dairy pricing system.

Noel Murphy, ICMSA chair said that the recent history of milk price ‘boom and busts’ only showed that the farmer is absorbing the hit as farmer price and income is used as a ‘market correction’ device by ‘all the links further up the chain’.

‘The farmer takes the hit straight away. This is an absolutely primitive way of managing a sector. It’s utterly destructive and it’s simply unsustainable for the family dairy farm to be the only ones left “holding the baby” when the markets fall”, he said.

‘It’s hugely important that we all see clearly what’s happening here. This isn’t any kind of “invisible hand of the market” at work; what’s happened here is that the other components of the dairy markets knowingly use farmer milk price as a ‘reset button’ for dairy product price movements. No-one else’s margins or incomes fall or are affected when we get the kind of price collapse we are seeing now. They all protect their own position in the knowledge that our reduced milk price and wiped income is effectively the ‘reset’ button for the whole cycle to start again’.  

Mr Murphy said that everybody understands that dairy markets have weakened in recent months with little warning: ‘Farmers understand this but we are questioning, and have every right to question, where all the processors’ “forward sold” contracts at defined prices have gone? These are always cited when prices are rising but are nowhere to be seen when the markets fall.’

By way of context, Mr Murphy said that the farmer milk price reductions over the last two months would represent a loss of €32,000 if applied to a full year for a 400,000-litre milk supplier.

‘Who else is expected to just take an income “hit” like that? Is there any other sector where people are just expected to do the same work and actually lose money, as will be the case for thousands of Irish farmers if prices fall below the cost of production?’

Meanwhile, the CSO’s latest figures show that milk intake by co-ops and processors in the country is up seven million litres compared to September 2024, and up 11 million litres against September 2023.

The intake in September this year was 774.7 million.

The latest Consumer Price Index also shows that two litres of milk now costs about €2.50, when in January 2012 it was about €1.78. A kilo of cheddar cheese, meanwhile, would set one back about €11.28; in 2012, it was more like  €10.70 and the big one: a pound of butter in 2012 was €2.77 compared to today, when it averages €4.87.