Compared to the same month last year, fat and protein percentages are ahead by 0.08% on average across all co-ops. Some co-ops are up this month by as much as 0.17%. This better-quality milk should be worth close to 1c/l of a bonus on average to milk price. Instead, co-op boards have decided over the months of March and April to cut milk price by close to 1c/l.
Compared to the same month last year, fat and protein percentages are ahead by 0.08% on average across all co-ops. Some co-ops are up this month by as much as 0.17%. This better-quality milk should be worth close to 1c/l of a bonus on average to milk price. Instead, co-op boards have decided over the months of March and April to cut milk price by close to 1c/l.
With no exceptional movements on dairy demand and market upsides to a potentially restricted global dairy supply, cutting milk price is the last thing co-op boards should be doing. However, despite milk solids improvement, co-op boards have decided to pull the price down, so effectively farmers get no price benefit from better milk solids.
The Ornua PPI price is 30c/l and if we look at the April milk, most of the big processors are paying 1c/l or less than this. This is a crucial time for milk suppliers as March, April and May milk price decides most of the income for milk suppliers.
Over the last two months, all the big players have cut milk price. In March, Glanbia, Arrabawn, and Lakeland all cut base price. In milk cheques just paid out, the west Cork co-ops, Kerry and Dairygold followed suit and dropped base price.
April movements
West Cork continues to set the pace, with April milk statements showing they paid close to €4.35/kg milk solids. Lakeland Dairies is the next best of the big players, paying €4.20/kg MS. Tipperary Co-op pays a relatively decent €4.11/kg MS considering the difficult year it had last year and with investment ongoing.
The division three players – Aurivo, Kerry, Arrabawn, Dairygold and Glanbia – all pay in the region of €4.05/kg MS, which is 0.30c/kg MS off the west Cork pace. That’s 2.5c/l less than the best Irish price.
If we combine the March and April milk price cuts, on average milk price has been cut 0.75c/l by the big players. On the March and April supply alone, that is close to €11m cut from milk cheques as cows head for peak milk supply.
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