Some €40m has been wiped off July milk cheques after three processors cut their base milk prices.
Glanbia and Kerry both cut 1c/l to bring them to 27.9c/l for July and Lakeland cut its price by 0.5c/l to bring it to 29.2c/l for July, all excluding VAT at the same milk solids.
The net effect is that Glanbia will pay out €23m less to its farmers compared with a scenario if it had held milk price. Kerry will pay out almost €13m less, while the Lakeland price drop means a €3.6m cut in milk cheques on the old Republic of Ireland milk pool.
Peak analysis
May, June and July are the three big volume months for spring milk suppliers, with over 40% of annual supply being delivered. We now know what price was paid over these three months. If we just compared these three months for Lakeland, Glanbia and Kerry, the Lakeland milk cheque is better to the tune of €1,800 for these three months alone for the typical farm.
PPI
The Ornua purchase price index (PPI) for July 2019 fell to 104.0, which has a farmgate equivalent price of 29.31c/l excluding VAT.
IFA dairy chair Tom Phelan said that Lakeland’s price proves that the PPI is attainable in the marketplace.
“I urge the other co-ops to heed this when deciding their own prices over the coming days. They must at a very minimum, hold prices at their current levels,” he said.
ICMSA dairy chair Gerald Quain said it was concerning to see that some of the larger processors were now paying up to 1.78c/l less on base price than their ‘northern’ counterparts, while also being several cents behind the west Cork co-ops before the latter have announced their July figures.
Quain said the trend confirmed the belief that perhaps some of our processors that had become the “darlings of the business pages” were slipping behind considerably in terms of the milk price they paid to farmer-suppliers.
Read more
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Some €40m has been wiped off July milk cheques after three processors cut their base milk prices.
Glanbia and Kerry both cut 1c/l to bring them to 27.9c/l for July and Lakeland cut its price by 0.5c/l to bring it to 29.2c/l for July, all excluding VAT at the same milk solids.
The net effect is that Glanbia will pay out €23m less to its farmers compared with a scenario if it had held milk price. Kerry will pay out almost €13m less, while the Lakeland price drop means a €3.6m cut in milk cheques on the old Republic of Ireland milk pool.
Peak analysis
May, June and July are the three big volume months for spring milk suppliers, with over 40% of annual supply being delivered. We now know what price was paid over these three months. If we just compared these three months for Lakeland, Glanbia and Kerry, the Lakeland milk cheque is better to the tune of €1,800 for these three months alone for the typical farm.
PPI
The Ornua purchase price index (PPI) for July 2019 fell to 104.0, which has a farmgate equivalent price of 29.31c/l excluding VAT.
IFA dairy chair Tom Phelan said that Lakeland’s price proves that the PPI is attainable in the marketplace.
“I urge the other co-ops to heed this when deciding their own prices over the coming days. They must at a very minimum, hold prices at their current levels,” he said.
ICMSA dairy chair Gerald Quain said it was concerning to see that some of the larger processors were now paying up to 1.78c/l less on base price than their ‘northern’ counterparts, while also being several cents behind the west Cork co-ops before the latter have announced their July figures.
Quain said the trend confirmed the belief that perhaps some of our processors that had become the “darlings of the business pages” were slipping behind considerably in terms of the milk price they paid to farmer-suppliers.
Read more
New entrant scoops Carbery milk quality award
Farmers told of the need to tackle chlorate levels
Fonterra predicts financial losses of €340m to €390m this year
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