The April milk league table published below reflects the first real cuts of the global downturn in milk prices.

The cuts to the May milk price, announced by processors over the last 10 days, are summarised in Table 1.

Arrabawn is on its own in Division 1 for April, maintaining its position towards the top of the monthly milk league.

Town of Monaghan is the big faller from the March league, as it slips down to Division 3 because the early calving bonus is gone and it cut April milk price by 1 c/litre at the May board meeting. Glanbia obviously cut the base April milk price as well, but the co-op top-up for shareholders is propping up the milk price.

The west Cork co-ops remain towards the top of the monthly league table but slip back into the top of Division 2 as Carbery cut 0.75 c/litre for April deliveries. Lakeland, Tipp Co-op and Dairygold all held March price for April. Aurivo held milk price for April but slips back into Division 2 as the early calving bonus that was in the March cheque is gone for April.

Kerry might have beaten Tipperary at the weekend to make it into the Munster football final but they won’t be getting any medals for milk price this year. It held March price for April but that just keeps it in the doldrums of Division 3.

Explanation

On top of the strong milk league price, the four co-ops in the Carbery group pay a bonus of 0.5 cent per litre for milk with an SCC of below 200,000 during the summer months – this is not included in the milk league ranking because it’s not paid to everyone. Conditional bonuses are not included in the monthly milk league but the west Cork co-ops would get the benefit of any money paid out on this to farmers in the KMPG/IFJ annual milk review.

The Irish Farmers Journal monthly milk league ranks processors on the price paid for a kilogramme of milk solids using the average milk fat and protein for last year (3.99% fat and 3.43% protein) in the calculations.

For a supplier with a typical April supply pattern, there is an €880 difference between the top player in the league and Monaghan for the standard litre of milk.

The April milk league is based on milk with a somatic cell count (SCC) of 250,000 and TBC of 30,000. Figure 2 shows the April milk payment using the average co-op solids that the processor collected.

May milk price cuts

Over the last 10 days, the downward trend in milk price announcements continued, but Glanbia and Aurivo signalled they will prop up milk price from reserves.

Glanbia decided to drop May milk price a further 1 c/litre to a base of 27.5 c/litre, but the co-op will top up milk price by 3 c/litre to bring GII price up to 30.5 c/litre for May.

At the Carbery board meeting last week, Carbery decided to drop milk price by a further 1 c/litre on top of the 0.75 c/litre announced in April.

Kerry has announced that its milk price is being cut by 2 c/litre, meaning that its May milk price will be close to 26 c/litre excl VAT. In the west, the Aurivo board has agreed to cut its milk price by 2 c/litre, bringing their VAT exclusive price down towards 27 c/litre. However, Aurivo has decided to use its stability fund to subsidise price to the tune of 1.5 c/litre. Lakeland announced last Thursday that it is cutting its May milk price by 1.5 c/litre.

Stability funds

As detailed in the news pages, Glanbia Ingredients Ireland again cut its May milk price, but the farmgate price will be supported with funds from Glanbia Co-op.

If paid on all milk, as per normal supply profiles, and if all suppliers were shareholders, I estimate that the March, April and May milk price top-ups come to a total of over €10m to date. We know some suppliers are not yet shareholders but, following the most recent Gowran vote, I’m told they will retrospectively be reimbursed with these 2015 top-ups once they have the opportunity to buy shares.

Aurivo are also propping up May milk price. Following a decision to cut 2 c/litre from base price for May deliveries, they are subsidising farmgate price to the tune of 1.5 c/litre.