Tirlán’s milk price drop is steepest of any co-op yet

Tirlán will pay a base price of 39.56c/l (excluding VAT) for September milk supplies after announcing a cut of 3.81c/l ex-VAT on the previous month.

A 3.81c/l cut leaves Tirlán’s suppliers facing the largest month-on-month base price pull of any co-op with a price announced so far for September.

The price decrease is worth over €1,800 to a 100-cow supplier at average September yields and constituents.

It follows a 2.38c/l (excluding VAT) decrease for August’s milk, which knocked the equivalent of €1,140 off the average milk cheque.

A sustainability action payment of 0.48c/l (excluding VAT) adjusted for constituents will be paid to qualifying suppliers.

Output growth

Co-op chair John Murphy said that September’s price pull comes on the back of higher-than-expected levels of global dairy output growth.

“Global milk supply and milk solids are tracking higher than expected, with continued strong growth in September and October,” Murphy commented when he announced September’s base price.

“European milk supply increased strongly from July into October on attractive margins and favourable weather.

“Unfortunately, milk supply growth is outpacing demand, which has weakened. Price for higher protein products, such as whey proteins, remain firm, but there have been sharp falls in the price of butter and cheese – two key products that are substantial drivers of milk price.”

Murphy stated that the co-op is “committed to maintaining financial discipline”, so that it can invest for longer-term growth.

He added that: “The co-op understands farmers’ disappointment at this sharp fall in market returns, which we are reflecting in lower farm gate milk prices.”

The suppliers of Dairygold, Kerry Dairy Ireland, Lakeland Dairies and Carbery have all witnessed a a month-on-month decline in base milk prices for September after the latest round of co-op board price setting.