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Co-ops must move to increase November’s milk prices in line with rising international dairy markets to restore farmer confidence, according to Irish Creamery Milk Suppliers’ Association (ICMSA) dairy chair Noel Murphy.
Murphy welcomed the “bounce” in global milk prices, but warned that this rise has yet to be seen in Irish suppliers’ milk cheques.
Some suppliers are now receiving 20c/l less for their milk than they received at the start of this year, the dairy chair said.
Muphy claimed that the prices co-ops are receiving for their output is on the up, but that farmers’ prices are not reflecting this market reality.
Lowest ebb
“Since the lowest ebb of Dutch dairy quotes in late August, the industry standard butter and skim milk powder mix are up almost 10.5c/l and the whole milk powder returns have increased almost 8c/l,” he said.
“This is a three-month-long sustained increase unprecedented in 2023 and shows conclusively that there is increased confidence in the market.
“That confidence and level of trade must be reflected in higher prices to farmers supplying those co-ops."
Murphy highlighted the need for co-ops to close the 3c/l gap between their October milk prices and Ornua’s purchase price index of 34.4c/l excluding VAT to restore farmer confidence in their processors.
“It’s worth drawing attention to the fact that those farmer suppliers have endured a miserable year, where costs of production have not eased back to original levels and are currently hovering around breakeven, with the prices being paid by their co-ops,” he continued.
“That has to change and we know - I repeat this - we know that the co-ops are getting better prices than their payments to their farmer suppliers would indicate.”
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