Contracted suppliers of liquid milk received an average price of 2.2c/l excluding VAT over the national annual average manufacturing milk price paid in 2023, according to the National Milk Agency’s 2023 report.

This liquid-manufacturing price difference was higher than it had been in the previous two years, but still at its fourth lowest level in 10 years, the report states. It had stood at 0.92/l in 2022.

The price gap rises to 2.73c/l when adjusting typically lower solids liquid milk supplies for constituents.

The average liquid milk price fell by 25% in the 2022-23 milk supply year, with the NMA putting the equivalent price drop for manufacturing milk at a higher 28%.

The agency stated that many farmers supplying liquid milk are assessing the high costs and labour demands of split calving systems against the lower-cost spring-calving model.

If processors continue to pay liquid milk suppliers “substantially increased incentives” the numbers leaving the sector could slow, NMA chair Denis Murphy said.