While holding base price at 29.1c/l excluding VAT the board of Glanbia dropped the 0.4c/l co-op “top-up” that they had in November and December and hence, in effect, dropped January milk price. In recent days, Lakeland, Kerry and Dairygold have all announced they are holding January milk prices. The west Cork co-op boards are lifting milk price by 0.5c/l.
Market indications were suggesting a milk price rise was on the way. GDT auction results were up 3% again this week, the seventh consecutive rise in auction results. Importantly, whole milk powder (WMP) was up by over 4.3%.
For January, Glanbia manufacturing or creamery milk suppliers get a “seasonality” top-up of 3.8 c/l excluding VAT. Obviously, January volumes supplied are small as calving really only kicks off in January and February for this cohort of suppliers.
However, those Glanbia milk suppliers with a liquid or autumn-calving scheme don’t get this “seasonality” payment as they are locked into other bonus schemes. Hence, the price they got in December was better than January with the co-op top-up gone.
Glanbia liquid suppliers get a 7c/l bonus in January and there is an 8c/l bonus for those in autumn-calving schemes.
Acting IFA dairy chair Stephen Arthur said: “Glanbia this month has claimed that the milk price for January remains the same as it was for December despite the removal of a 0.4c/l bonus. Glanbia is notorious for using bonuses to manipulate the farm gate price. If they are included, management uses them to bolster the base price quotation, yet when they are removed, they claim milk price is the same. What really matters is the value of the milk cheque and Glanbia can’t hide from the simple fact that farmers are receiving less this month,” he concluded.
Fresh Milk Producers (FMP) chair Willie Lennon has condemned Glanbia for the January cut in base milk price which he said has left over 850 contracted liquid and autumn calving scheme (ACS) suppliers receiving less for their milk in January.
Willie Lennon said: “No milk supplier should have taken a milk price cut for January but that is what Glanbia has done to over 850 family farms with this January milk price decision.”