FOLLOWING the announcement from numerous milk processors of a lift in their July milk price, the chairperson of ICMSA’s dairy committee said he wholeheartedly welcomed the news and he expressed hope that some of the current positive market sentiment will translate back into better farmgate prices over the coming months.
Ger Quain noted that Lakelands, Kerry, Aurivo and individual co-ops in West Cork had all raised their price for July milk but he said that farmer attention would focus on what he described as the ‘very substantial discrepancies’ that existed between the final prices of those co-ops.
‘Farmers will be looking at the fact that Lisavaird are paying over 35 c/L while Aurivo are at 31.5 c/L, that’s a very substantial price gap,’ he said.
‘And while ICMSA will always acknowledge those co-ops paying a rising price, we equally will always stress that the Ornua PPI is the minimum price that should be returned and a higher price must be paid if possible,’ he stated.
Looking at current wholesale markets, Mr Quain said they showed that Dutch Dairy Quotations have reached higher levels across most categories this week again, with butter fetching over €5,500 per tonne after slipping back last month.
‘The standard Butter/SMP mix is equivalent to 34.1 c/L translated back to the farmgate and those prices will have to be returned if initial estimates of total costs of production for 2018 are correct – the doubling-up of 2018 costs resulting from a long winter and drought summer will exert pressures on every dairy farmer in the country and their co-ops will have to understand that many of their suppliers are going to be at make-or-break levels this coming winter and spring and milk price will decide the issue either way,’ he said.