LIVESTOCK - Dairy
News | Husbandry | Features | Milk League
3rd November 2001

By Joe Rea

The West Cork phenomenon continues. In the August league the top four places on actual payout go to the West Cork group of creameries.

Prices are impressive. Lisavaird is best at over 114p. This price is boosted by excellent fat - 3.84%, the highest in the league - with protein at 3.35%. All the others - Bandon, Barryroe and Drinagh - beat 113p.

The excellence of the central processing at Ballineen is a key factor in this performance. It has a legacy of enterprise, efficiency and top management.

There are further gains this year because it has significantly expanded its cheese processing capacity.

It could not have picked a better year to expand cheese production. All the markets are delivering increased returns. Wexford, which is top on the standardised league basis, is again clearly gaining from the buoyancy of the cheese market.

In a rapidly repositioning world dairy market, changes are now imperative. Just think New Zealand/Fonterra. Ireland cannot be left behind to be pushed around. Should the West Cork model be the basis for progress and rationalisation on the Irish scene?

Should the Irish Dairy Board be linking up with other international players to redress the Fonterra drive?

OPEC

Some weeks ago I wrote about a New Zealand Milk OPEC. It now appears to be coming closer.

The news last week that Fonterra had joined forces with Denmark's MD Foods/Arla to handle jointly New Zealand Anchor Butter and Danish Lurpac on the English market is another development of the OPEC milk concept.

Already New Zealand Butter has over 50% of the UK packed butter market.

Price drop

The August league concerns price reductions already signalled in the case of Tipperary, Thurles and Arrabawn.

Predicted September prices now appear in the final column of the league proper.

Downward price pressure on skim milk powder and butter is reflected in more price cuts. Lakeland and Donegal drop by 2p while Connaught Gold reduce by 1p.

Friesland pays 129p

Friesland, the giant Dutch processor handling more milk than Ireland's creamery milk quota, leads the EU comparison. Its August price is 129.25p. This is 14p a gallon over its rolling average for the previous 12 months.

It also shows a dramatic increase compared to recent months. The reason for this is that German milk prices have increased dramatically. Here the consequence for Friesland is that its milk price is indexed to a number of high paying German creameries.

Indeed this fact also emerges from the international table. Nordmilch of Germany are just marginally behind Friesland.

It should be noted that for comparison purposes all milk in the international table is standardised at the Irish milk league base of 3.6% fat and 3.3% protein.

However, in practice Dutch fat runs at around 4.4% and protein 3.4%. Therefore the actual payout price to farmers would be comfortably over 140p per gallon.

Speaking to some Dutch farmers, they are very surprised that their Irish counterparts cannot write off the cost of milk quota purchases over a number of years.

Such write-off are available in the Netherlands for some time without any objection from the EU Commission.

Why has the Irish government rolled out the Brussels red herring to slow down this tax procedure for Ireland?

You can view this months Milk League Table
using Adobe Acrobat 4.0