Irish Farmers Journal's 2014 milk price review

Barryroe has topped the 2014 annual Irish Farmers Journal/KPMG Milk Price Review, continuing a very good run of form.

The average milk price paid in 2014 was 36.31 c/litre, which was back from the average 37.71 c/litre paid out in 2013, but substantially higher than the 30.81 c/litre paid out in 2012.

Dairygold and GII – the two big processors in the south and east – are sandwiched between the smaller west Cork Co-operatives Lisavaird and Drinagh.

Dairygold has been hovering around a top five position for the last number of years and finishing number two this year will keep the mainly Cork suppliers happy.

GII has been consistently outside the top five for a number of years and its fourth place finish this year will be very welcome to the suppliers in the east of the country.

In mid table, Tipperary, Aurivo and Kerry paid a very similar net price with less than €10 per cow deviation from the average price paid.

Lakeland remains towards the back of the field, over €110 per cow back from the best but over €50 per cow ahead of Town of Monaghan, which brings up the rear.

Town of Monaghan paid the lowest net price again in 2014, the same as 2013. One factor worth mentioning is that it receives milk with the lowest fat and protein. On the other hand, it does benefit from a very flat milk supply profile.

Again this year to aid presentation and understanding we have highlighted the proportion of annual manufacturing milk supply delivered during the winter months for all processors. Much of this milk qualifies for a winter milk bonus in an effort to compensate farmers for the higher costs of producing milk during the winter months.

Trend analysis

GII is the most improved performer from 2013, moving from eighth position to fourth this year. Dairygold is the next-best improver.

It is fair to say there is not a massive spread in milk price between the top 10 processors. A range of 1.6 c/litre (35.9 c/litre to 37.5 c/litre) covers the top 10.

Kerry has moved in the wrong direction with a 2014 price of 36.05 c/litre, finishing ninth and it had been seventh for the three years prior to 2014. For the first time in the last ten years, Bandon was pushed out of the top five.

The Milk Price Review examines the price paid for manufacturing milk and excludes all milk bought for or used in the liquid milk market. For example, milk purchased as manufacturing by Lisavaird and Bandon co-ops but sold to Clona Dairies was excluded from the price review.

The Milk Price Review is an input to the overall comparison of performance across processors. There are a number of other inputs including profitability, shareholding requirements and capital contributions by suppliers, all of which are relevant to enable an overall assessment of performance in any one year and trends across a number of years.

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