The chairperson of Tipperary ICMSA, Seamus Troy, said that as far as his organisation was concerned a substantial price rise for September milk is a “must”.
“We’d be looking at in excess of 27 cent per litre being returned by all co-ops and processors for supplies made in that month”.
Mr Troy noted that the latest indicators of dairy markets made for further positive reading and the market could reasonably be described as “buoyant”.
“Against current background and underlying momentum, we would be looking at the latest significant rise of 6.4 percentage points in the Ornua Price Index to 92.2 which – even allowing for the excessive processing costs that ICMSA thinks the Ornua Index is predicated on - translates across to a situation where suppliers are absolutely correct and reasonable in expecting their co-ops and processors to pay in excess of 27cpl for September milk”, said Mr Troy, who dismissed the 3 per cent fall in the latest GDTA.
“The 3 per cent fall in the latest GDTA is a market tweak and is actually irrelevant in terms of price-setting.
“All the significant momentum is positive and we’d look particularly at the increases in the Dutch Dairy Quotations and the underlying surge in the Global Dairy Trade Auctions – with the latter up over 40 per cent since March reflecting strong demand for all products.
“The Dutch dairy quotations are reflecting a far stronger market for dairy products in the EU and we’ve very encouraged by the fact that the Butter/SMP combination has shown a substantial increase of almost 3cpl on its late August levels.
“The momentum is better illustrated when you consider that the Butter/SMP mix is up almost 12 cents per litre since its trough in March 2016.
“The WMP equivalent is up over 11cents per litre in the same time period. The figures are there and they are undeniable: we know the rates of increase now being returned and ICMSA is stating categorically that it’s time for the farmer-suppliers to get similar increases. That means in excess of 27cpl for September milk,” he stated