Base prices for milk delivered in July averaged 28p/litre, putting it 10p/litre higher than the average price for the same month in the previous year.

For a one million litre producer with seasonal supply, the increase in milk price should see an additional £9,500 in this month’s milk cheque compared to the same month last year.

While there have been significant increases in milk prices since July 2016, at current base prices around of 28p/litre, many farmers are still in a break-even position or just entering a marginal profit making situation after milk quality payments are applied.

Table A outlines milk prices over the past 12 months for a dairy farmer supplying 350,000 litres annually.

Across all processors, good-quality milk averaged 26.76p/litre, while average-quality milk averaged 25.48p/litre.

On good-quality milk, Aurivo paid the highest farmgate price at 27.05p/litre. The southern-based co-op is the only processor to pay above 27p/litre over the past 12 months. They also paid the highest price on average quality milk at 25.66p/litre.

One million litres

Table B outlines the average prices paid by milk processors over the past year to dairy farmers supplying one million litres annually.

On good-quality milk, the average price paid across all processors was 27.16p/litre. All processors paid above 27p/litre on good-quality milk, with the exception of LacPatrick, who paid 26.96p/litre on standard milk.

However, indications are that the majority of all milk supplied to LacPatrick now meets Red Tractor standards and qualifies for the additional 0.2p/litre bonus.

Aurivo paid the highest price for good-quality milk at 27.32p/litre, followed by Lakeland, who slipped to second place this month.

The parameters for good-quality milk are 4.09% butterfat, 3.36% protein, 4.87% lactose, under 10 TBC and under 100 SCC as outlined in Table 1.

However, the amount of dairy farmers who actually meet these standards and realise the higher prices outlined in either Table B or Table 3 is generally small.

Average quality

Therefore, the price on average-quality milk is arguably more reflective of farmgate prices. Glanbia Cheese paid the highest price at 26.13p/litre over the past 12 months, followed by Aurivo on 25.93p/litre.

Dale Farm is in third place, with LacPatrick Red Tractor price in fourth and Lakeland in fifth position. Glanbia Milk and Fivemiletown are in joint sixth place.