The Glanbia Ingredients Ireland Limited (GIIL) milk contract will run for five years rather than seven, as had originally been proposed earlier this year.
Speaking to the GIIL council yesterday (Wednesday), Jim Bergin said: “Following feedback from our representative structure, we are asking our suppliers to sign up to an initial three-year agreement, starting in January 2015, and then if they want to move processor, they must give two years’ notice, so five years in total.”
This is shorter than at Dairygold and Kerry Foods, which both require farmers to sign up for seven and 12 years respectively.
Glanbia has also decided to create a €2.5m loyalty fund to share among those farmers who sign up before the end of June. Glanbia says this “sweetener” will equate to almost 1c/litre on volumes supplied in June, if the expected number of farmers sign up by the end of June. Glanbia also clarified that only those who sign up to the milk contracts will be eligible for bonuses and allowed to apply for the fixed milk price scheme. Details of the new fixed milk price scheme are to be released next week.
The other main changes from earlier proposals are:
Next week, Glanbia will be sending out written notices to their suppliers, outlining the key issues they need to understand when signing their milk contracts.