The decision to cut March milk price by two co-ops has been criticised
The decision by Glanbia Ireland and Lakeland co-ops to cut their March milk price has been criticised by the IFA
The move was described as a “ big blow for farmers” by IFA national dairy chairman Tom Phelan.
Glanbia announced last week that it will pay a base milk price for March of 30cpl including VAT, for manufacturing milk at 3.6% fat and 3.3% protein. The interim market payment of 1 cpl that was paid by Glanbia Ireland on January and February milk supplies will not be paid for March.
The co-op will make a support payment to members of 0.5cpl, including VAT, giving a milk price of 30.5cpl.
A price of 31.56cpl including VAT and the lactose bonus has been agreed by Lakeland for milk supplied in March.
This represents a realignment of 0.5cpl on the February price, according to the co-op.
“The decision by both co-ops is unwarranted. Cash flow on dairy farms is critical at this time of the year, with farmers facing increased costs of production across the board,” said Mr Phelan.
Meanwhile, Glanbia said that its base milk price and the support payment will be adjusted to reflect the actual constituents of milk delivered by suppliers.
“Glanbia Ireland has maintained its base price of 30cpl to reflect current market returns”, said chairman Martin Keane.
He said that while global milk supply growth was lower than previous years and oil prices had increased, market demand in some regions was being adversely affected by challenges that included lower economic growth, Brexit and trade wars.
Butter prices had weakened and the market was currently working through the large volume of intervention powder stocks that were purchased late last year.
Dairygold has confirmed that its base price for March milk supplies, based on standard constituents of 3.3% Protein and 3.6% Butterfat, inclusive of VAT and bonuses is 31.19cpl, unchanged on the February milk price.
This equates to a farm gate milk price of 33.78cpl based on average March milk solids for all Dairygold milk suppliers.