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Arrabawn and Aurivo have both confirmed that they have withdrawn from participating in the KPMG/Irish Farmers Journal annual milk price review.
Both processors indicated that they want the money they pay out for "liquid" milk to be included in the manufacturing milk price review.
In an open letter to Arrabawn and Aurivo milk suppliers in this week's Irish Farmers Journal, editor and CEO Justin McCarthy outlined his thoughts on the Aurivo and Arrabawn decision to pull out.
“We would challenge the decision that a co-op board representing the interests of farmers would in a year when your businesses have seen shareholders' value written off balance sheets, operating profits reduced, new investments unveiled, decide to reduce milk price transparency to farmers.”
Manufacturing milk
The annual manufacturing milk price review, as reviewed by KPMG, divides the money paid out on all manufacturing milk to all suppliers divided by the total manufacturing litres collected. It excludes contracted liquid milk and money paid out for liquid milk.
On Wednesday, the chair of Arrabawn, Edward Carr, called for criteria for the annual milk price review process to be changed in the interest of transparency.
In a letter sent to the co-op’s 1,000 suppliers, he said that the board of Arrabawn had unanimously taken the decision not to participate in the programme this year because of the "continued exclusion of liquid milk premium".
Carr, from Kilcommon, Co Tipperary, said that "excluding liquid milk from this review discriminates against Arrabawn and its suppliers as it fails to reflect both the true price paid by Arrabawn and the long hours and hard work of those suppliers it ignores”.
Aurivo
Aurivo chief executive Donal Tierney also released a statement to suppliers.
In it, he said: "Aurivo Co-op has notified the Irish Farmers Journal that we will not be participating in the 2019 milk price review. The decision was taken uniformly by both the board and management of Aurivo. This is the correct decision for the co-op given what we firmly believe is the flawed nature of a 'manufacturing milk' league table that excludes fresh milk sold for domestic consumption.”
Supplier view
If you are an Arrabawn or Aurivo supplier we want to know your thoughts and opinions on the processors' exit from the milk price review.
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