The Ornua purchase price index for the month of March is 164.3 (46.5 c/l excluding VAT) based on Ornua’s product purchase mix and assumed member processing costs of 9.7c/l. It is up from 152.3 in the previous month.
Ornua says the increase is as a result of continued stronger returns across the product range.
In addition, the Ornua value payment payable to members in the month is €5.55m, which equated to 4.4% of gross purchases in the month (3.6% year to date). This equates to another 2.6c/l equivalent of farmgate milk price leaving the comparable milk price at 49.1c/l excluding VAT. The February milk league had an average price of 41.3c/l excluding VAT at base solids.
Stephen Arthur, chair of IFA’s national dairy committee, said that dairy farmer costs of production were also increasing significantly.
It’s essential that we get the milk price the market is returning and we are relying on our processors to deliver this
“In a normal year, a milk price in the forties would indicate a strong year for dairy farmers, but this year isn’t normal. Like the processors, our costs are also spiralling. It’s essential that we get the milk price the market is returning and we are relying on our processors to deliver this,” he said.
Base milk price
Speaking in advance of the imminent March milk price announcements by the co-ops, ICMSA dairy committee chair, Noel Murphy, has called on all co-ops and milk purchasers to bring base milk price up to 50c/l for March supplies.
Murphy said that the price is fully justified by market returns while also being required to deal with surging input costs.