Glanbia Co-op has announced that it will be changing the timing of milk payments to farmers, in response to the current inflation in farm inputs.

The board of Glanbia Co-op has announced a six-month pilot change in the timing of milk payments, which includes a new early milk payment each month.

The new policy will begin with the June milk payment in July.

How will it work?

From July, approximately 50% of the payment due to milk suppliers will be paid early (on the ninth of the month rather than the 18th).

Once milk price for the month is set, the remaining balance due to milk suppliers will be paid by the 25th of the month and any deductions due on milk accounts will be split evenly between the two payment dates, which will assist farmers with high levels of deductions.

Glanbia has said that the early payment value will be calculated based on the previous month’s announced price and it will be adjusted for constituents and any applicable bonus payments.

Fifty per cent of this net milk value will be paid, it said, less 50% of any applicable deductions.

A remittance note will be issued for the early payment, while the monthly milk statement will be issued after the final milk payment.

Cashflow

Glanbia Co-op chair John Murphy said dairy market prices are currently at record levels and demand is strong due to curtailed milk supply globally.

“However, the price and availability of key inputs such as feed, fertiliser and energy are volatile and uncertain, which is impacting on our farmers.

“In this period of extreme input cost inflation, the co-op board believes that an early milk payment each month will assist our farmers by providing a more regular cash inflow approximately every fortnight.

“The board has agreed to implement this payment structure on a pilot basis for the second half of 2022. The board will review feedback from suppliers before deciding on the payment policy for 2023,” he said.