IFA national dairy committee chair Tom Phelan said the 1c/l cut by Glanbia for August milk to a total payout of 27.04c/l plus VAT, the second in as many months, is a major blow to the cashflow and confidence of its suppliers. He said this would be seen by all dairy farmers as a threat to the milk price decisions in their own co-ops later this month. The Lakeland 0.75c/l cut to a price of 28.5c/l plus VAT, which follows a 0.5c/l cut for July milk – while less severe – is also disappointing.

Phelan called on the board members of all other co-ops to not follow slavishly the Glanbia example in cutting below the August Ornua PPI of 29.22c/l plus VAT, and be more reflective of stable European trends.

“The European Commission’s Milk Market Observatory tells us that EU average milk prices for July 2019 were up 6% compared with the same month last year, but Irish milk prices were down 2% – only Denmark and Greece performed worse.

“The milk prices paid by the main EU milk purchasers have been stable. FrieslandCampina has held its €35/kg price for July and August and will continue into September.

“This is 30c/l plus VAT at 3.3% to 3.6%. Arla has held its price for the past eight months, and will also hold its September price, with a UK milk price of 30.22p/l (33.8c/l). The market returns determining those price decisions are the very same markets our co-ops compete on, so why so poor a price performance from Irish co-ops?” he asked.

“Glanbia, Kerry and Dairygold are all included in the LTO monthly milk price review of European milk purchasers, and have fallen well below the average price of the review for the last number of months,” Phelan said.