Ahead of milk processors setting prices for July supplies, dairy farmers have again highlighted the current cashflow pressures on farms, and urged co-ops to do more to support prices.

According to Warringstown farmer Charlie Weir, dairy farmers are really struggling at the moment to cover bills.

“The way currency has gone (€1 = 92p) it should be benefiting our milk price. When it goes in the other direction the co-ops are quick to take the price down,” he suggested.

In Britain, where buyers are currently setting prices for September, the market is generally holding, although some have reduced prices.

One of the most recent significant cuts has come at liquid milk supplier Freshways, which has taken 2p/l off its milk price, leaving a liquid standard litre price of 25p/l.

Glanbia Cheese, which has a factory in Wales, is down 1p/l to 27p/l from September.

However, First Milk held at a manufacturing price of 28.37p/l, while Arla is paying from a base of 30.22p/l in August.

These prices are generally on a base of 4.2% butterfat and 3.4% protein, so not directly comparable with NI, however, AHDB analysis suggests that prices paid in NI are approximately 1p/l behind those in Britain.

“A lot of farmers in NI just don’t understand why they are being paid less than farmers in Britain. Also why are co-ops so keen to take on new suppliers when existing producers are struggling at the prices on offer?” asked Weir.

Strain

According to local farm consultant Ian Carrick, the average cost of production among his clients remains around the 28p/l mark, which is putting a major strain on cashflow. He points out that farmers are being squeezed at either end – milk prices have trended down this year, while there has been an inflation in costs.

“There just seems to be a lot of one-way traffic at the moment. The person at the bottom of the food chain is getting less, yet is expected to invest in technology to lower emissions, robotics to lower labour and infrastructure to comply with Red Tractor.

“There simply has to be a better margin for those putting in the time and investment than there is at present,” said Carrick.

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