Glanbia Ireland moved this week to warn farmers of the risks involved in supplying more than their allocated volumes during the peak months in 2022 to 2024.
The warnings come as milk suppliers received letters detailing how much milk they can supply during the peak months without incurring deductions in milk price.
The letters state that additional volumes produced will be paid 30% less than the prevailing milk price at the time, or the net cost of disposal of the milk in the event that it is unable to be processed.
In this situation, not only will farmers not get paid for the extra milk produced during the peak months, but they could get charged for delivering it.
A Glanbia spokesman said farmers should carefully consider the implications of supplying more than their allocation.
“If all the additional milk is collected and processed, the profit generated is returned back to the overall milk pool in off-peak milk price.
“However, if the additional milk can’t be processed and needs to be disposed of, the cost of that exercise will be borne by those that exceeded their allocation,” he said.