Milk processors need to increase the price paid to their dairy farmers for their May milk supplies, Irish Farmers’ Association (IFA) dairy chair Stephen Arthur has said.

Arthur said that markets are improving, with the Global Dairy Trade this week showing an improvement of 1.7% on the last trade two weeks ago.

Butter is trading at almost €7,000/t, up 1.7% and skim is up 3% at €2,722/t.

“Ornua’s PPI return for May is 39.6c/l, VAT inclusive, which is an increase of 1.1 c/l from the previous month, with the Ornua value payment worth an estimated additional 2.97 c/l including VAT. This price represents an increase on Ornua’s PPI return of 4.93c/l since January of this year,” the dairy chair said.

Reduced sales

With milk volumes continuing to fall short of 2023 levels, there has been reduced sales for dairy farmers, alongside the increased cost of production from the very difficult spring. Arthur said that dairy farmers need to be paid for their product and believes the market can support a price increase.

“An increase in price is needed to alleviate the cashflow pressure on suppliers and it is essential that processors start returning the value gained in the market back to farmers,” he concluded.