IFA National Dairy Chairman Tom Phelan has said that farmers are disappointed that Lakeland had missed the opportunity to increase their June milk price at a time when this was justified, and their suppliers needed it badly.
He said farmers would not tolerate other co-ops, many of which paid less than Lakeland for May milk, using the Lakeland example as an excuse.
“They can and must do better”, Mr Phelan said.
“I have called for co-ops to include the May fodder / weather support into the June base price, and to further increase the June base by at least 1cpl. This is fully justified by increased market returns during June, and absolutely necessary to support farmers’ cash flow in one of the most challenging years many have ever experienced,” he said.
Meanwhile, ICMSA dairy chair Gerald Quain, said that all milk processors needed to recognise the improved dairy market conditions along with hard-pressed farmer sentiment on the ground and increase milk price.
Mr Quain said that 2018 had seen every variable thrown at farming in the first six months, from freezing to sweltering and wet to dry, and it was time for the co-ops to move the milk price paid to their suppliers upwards in accordance with market developments and the pressure on their farmer-suppliers.
Dairy markets had increased steadily from their lowest point in March to a current position where the Butter/SMP mix was slightly below 35cpl after processing in the spot market, he pointed out.
“Of course, it is the Ornua PPI that will show the real basket of Irish goods sold in June and this is the reference point where all co-ops should be starting,” he said.
Mr Quain said that the PPI should not be seen as a maximum but instead as a minimum target each month where paying a price below its cent per litre breakdown was simply not acceptable.
“The price paid in June is of supreme importance given the costs associated with the six months just gone,” said Mr Quain.
The drought conditions were being described as the most serious in a generation, stated Mr. Quain, and that may be true, “but what is absolutely certain is that dairy markets justify a higher price than is currently being paid by most of our processors”.
He said that co-op boards simply had to raise milk prices accordingly.