€11m wiped off milk cheques

The combined effect of March and April milk price cuts have wiped close to €11m off farmers’ milk cheques, as cows head for peak milk supply.

The west Cork co-ops dropped 1c/l for April across the board, but remain 2c- to -3c/l ahead of bigger co-ops, paying 30.7 c/l base price ex VAT for milk at 3.3% protein and 3.6% fat.

Cuts

Kerry and Dairygold also cut milk price for April by 0.5c/l, paying 28.9 c/l ex VAT for April. Aurivo, Arrabawn, Lakeland and Glanbia all held milk price for April.

Combining March and April milk price cuts, on average milk price has been cut 0.75 c/l across the big players, totalling a cut of €11m off milk cheques.

Milk processing capacity, while extremely tight, is not a dumping issue in Ireland, given recent processing investments. However, there are reports of milk being dumped in Scotland and the UK because factories cannot process it.

The Global Dairy Trade auction result showed a fall of 1.2% this week – the first fall since December 2018.

Demand

Speaking in London recently, Torsten Hemme managing director of the IFCN Network, said all the market signals are pointing towards a shift upwards on milk price.

The German’s assumptions are based on the fact that the key drivers of milk price are supply and demand and, right now, global supply is not strong.

He said: “Let me summarise; supply is very weak, dairy stocks in storage are low, and I’m surprised that future markets are so relaxed. I would have expected them to see what is coming, which I think is demand outstripping supply.”

Read more

Arrabawn, Carbery and Aurivo set milk prices for April

Dairygold cuts milk price for April

Listen: optimism mixed with realism from dairy experts