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Barryroe paid a milk price of 35.29 c/l excluding VAT, levies and collection charges to suppliers in 2019. In second place is near neighbour Lisavaird Co-op. Kerry Agribusiness come in third as it paid out an unconditional 2.85 c/l ex VAT goodwill payment to all Kerry suppliers. However, it wasn’t enough to edge it ahead of Barryroe and Lisavaird.
Kerry said when this was paid out that it was a goodwill top-up payment in respect of milk supplied over the five-year period from 2015 to 2019. In theory, only one-fifth of the payment, 0.57 c/l might be included. However, the remaining four-fifths of the payment was not included in prior years, and therefore the full payment is included in 2019.
The other two west Cork co-ops, Bandon and Drinagh, take up fourth and fifth positions respectively, maintaining consistent good positions relative to other co-ops.
Average price
The average net price paid in 2019 was 33.74c/l, down 0.89c/l on the 2018 average milk price. It is still a relatively high milk price and is the fifth highest price when we look back over the last 10 years (Figure 5). The highest price in the last 10 years was in 2013 when the price averaged 37.76 c/l.
The four west Cork co-ops that trade under the Carbery banner and Kerry keep Glanbia and Dairygold out of the top five positions. Ranking sixth is Glanbia. The Glanbia price of 33.12 c/l does not include the €12.6m paid out to shareholders as part of the various Glanbia trading schemes. This is an indirect bonus if a supplier decides to trade with Glanbia and outside the scope of this exercise. Glanbia suppliers deliver the best milk fat and protein percentages of all processors at 4.25% fat and 3.58% protein. Dairygold Co-op comes in seventh position, with an annual price of 32.78c/l ex VAT at Dairygold milk solids.
Tipperary Co-op and Lakeland bring up the rear of the annual milk price review when it’s ranked. Lakeland suppliers delivered the lowest milk fat and protein percentages on average at 4.07% fat and 3.44% protein. Dairygold, Glanbia and Tipperary had by far the best fat and protein percentages when compared with other processors. Tipperary Co-op has had two difficult years and hence milk price has suffered.
Dairygold and Glanbia are by far the biggest processors and between them had almost 60% of the 2019 manufacturing milk supply captured in this analysis. In total, this exercise captures about 85% of the total manufacturing milk pool, down by 8% from last year.
The boards of Arrabawn and Aurivo decided not to participate in this exercise as they want to include the money paid out to liquid milk suppliers in the analysis of manufacturing milk supply. Last year, both Aurivo and Arrabawn filled the bottom two places in the annual analysis but this year they have decided not to participate.
Difference
Again there is a significant difference between top and bottom on milk price. A 5,000 litre cow supplying Barryroe would have yielded €1,765 in output value compared to a 5,000 litre cow delivering to Lakeland yielding a value of €1,587, that’s €178 less per cow.
Some of this price difference is explained by the fact the lower ranking processors get poorer fat and protein compared to the co-ops higher up the milk price review table. Some also benefit from a higher proportion of milk delivered in November, December and January with winter premiums included. From Table 1 you can see 12.67% of the annual manufacturing milk is collected from November to January inclusive for Lakeland, almost the very same as Barryroe. The IFJ/KPMG milk price review examines the price paid for manufacturing milk and excludes all milk bought for or used in the liquid milk market.
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