The scheme will run from 1 January 2016 to 30 June 2017, with the fixed price of 30.1c/l based on 3.6% fat and 3.3% protein. The scheme is open to 20m litres, which is 5% of Carbery’s 2014 milk pool. Farmers can fix 5% of their own milk pool, meaning that 95% of the farmer's milk is left on the open market.

The average milk price in the country is currently 25c/l-26c/l so the fixed milk price scheme entails a jump of approximately 5c/l for Carbery's suppliers.

Carbery commercial director JJ Walsh told the Irish Farmers Journal: “We have launched this fixed milk price scheme in order to put a floor under our suppliers’ milk price for the next 18 months. We see it as a very good price given the current market conditions we are operating in. Farmers are aware that investments are made with the long term in mind. Houses, parlours, things like that are for the longer term, so we would encourage farmers to take the same perspective with milk price. However, in the short term, it is important to put a floor under prices and I feel we have done that.”

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The only other processor in the country with a fixed milk price scheme is Glanbia, Ireland's largest dairy processor. Glanbia's scheme will have a base price of 30.25c/l (incl VAT) and will run from January 2016 to the end of June 2017.

Carbery, whose four co-ops − Bandon, Lisavaird, Drinagh and Barryroe − have been leading on the milk price league table all year, also announced on Tuesday that it is cutting its October milk price by 1c/l.