Rising levels of butterfat and protein at this time of year provide a useful boost to the price in the milk cheque for September milk.

And with base prices rising, albeit at a much slower rate than farmers would like, milk prices in the league are now mostly in the range of 21p/l to 22p/l for milk collected on alternate days.

The prices are after deduction for transport charges for a supplier with 650,000 litres per year with an average seasonality of supply and with milk quality of 4.15% butterfat, 3.43% protein, 4.58% lactose, a TBC of 19 and SCC of 205 in the month.

However, with its chart-topping price increase of 2p, Strathroy Dairy is the league leader with a price of 23.16p. This is calculated from its standard price schedule with adjustments for butterfat, protein, TBC and SCC and with a deduction for transport costs based on a maximum of £10 per collection.

At Glanbia Milk and Fivemiletown Co-op, following their 1p price increase, their calculated prices in the league fall just short of 22p/l at 21.93p/l.

The position at the top of the league for Strathroy, Glanbia Milk and Fivemiletown in September is a repetition of their positions for August milk.

Red Tractor

Next are the Red Tractor prices for LacPatrick at 21.84p and Glanbia Cheese at 21.76p.

As highlighted in the Irish Farmers Journal last month, the price now declared by Glanbia Cheese is for Red Tractor milk, with no price declared for non-Red Tractor.

For the small proportion of its milk not achieving Red Tractor status, the producers in question will suffer a price penalty of 0.5p/l. The Glanbia Cheese price for September includes an increase of 1p plus the Red Tractor element of 0.5p.

At LacPatrick, the declared price is for non-Red Tractor, and the league price works out at 21.64p. Its Red Tractor bonus is 0.2p, pushing its Red Tractor price to 21.84p. In the calculations, the LacPatrick base price is up by 1p, as a result of it pulling forward its end-of-year bonus from December to September.

At Dale Farm, which for some time has been declaring only a Red Tractor price, its calculated price in the league is at 21.46p/l.

This follows an increase in its base price of 0.3p/l, plus the additional benefit of an increase in its loyalty bonus of 0.2p, taking it 0.3p. The loyalty bonus is applicable to members of United who do not have a notice to leave lodged with the company and all but a very small number of members earn the loyalty bonus.

It is worth noting that Strathroy Dairy also pays a bonus on Red Tractor milk of 0.2p, although it is not yet marketing any of their products as Red Tractor-assured.

Towards the bottom of the league is Aurivo with a price of 21.53p and Lakeland with 21.24p.

Fixed prices

It should be noted that both Lakeland and Aurivo have introduced fixed-price contracts for producers on up to 10% of their milk.

The Lakeland fixed price is 20.75p for September (and is scheduled to increase to 21.75p for the period October to March inclusive). This is now only 0.75p above the base price and for a producer fixing on 10% of their milk, it boosts their price across all litres by only 0.075p.

At Aurivo, the fixed price is 23p and is 2.75p above the base. For a producer fixing 10% of their milk, the increase across all litres supplied is 0.275p.

With the continuing rise in base prices in September, the rolling averages for the 12 months to September are showing small increases on the averages to August.

The September base prices for this year included in the averages are around 2.3p/l higher than the September figures last year, which are now dropped from the calculations. The figure is slightly higher at Glanbia Cheese Red Tractor and slightly lower at Dale Farm Red Tractor.

Looking at the rolling average figures to September, compared with August, they are just under 0.2p/l higher, a small figure which illustrates that much higher prices are needed to make up for the prolonged period of very low prices.

For average quality milk for the 350,000 litres (Table A) and one million litres (Table B) per year producer, the average price for both sizes for the year struggles to get above 19p. For good quality, the position is slightly better with more producers making 20p and above for the 350,000-litre size and almost all getting between 20p and 21p at the one million litre size.

For any producer with poor levels of butterfat and protein, the position is bleak, with prices for the 12 months averaging only 17.83p with the best company, and below this figure for all of the others. Producers with below average quality milk are earning 3p/l less than producers with good quality. Looking at the difference between top and bottom prices paid by buyers for each quality shows that the differences are small at 0.7p, except for the 350,000-litre producer with below average quality milk. Here, the top-to-bottom gap is 1.1p. Compare that to the one million-litre producer at average quality, where the gap is only 0.5p.

The differences over the year for the top four companies are smaller still at just over 0.1p/l for good quality and average quality; although they are slightly more at 0.3p and 0.4p for below average quality.

  • Note that our tables do not include the fixed price element at Lakeland and Aurivo, nor the top-ups paid to Glanbia Milk suppliers who receive bonuses as members of Glanbia Co-op.

    • Crossbreeding yields 5.6p/l

    With milk quality for fat and protein reaching seasonal highs on many farms, dairy producers who have introduced Jersey crossbreeding into their herds, in search of a smaller cow with lower maintenance requirements and improved milk quality, are now seeing the benefits.

    One producer in Co Down who made this type of change to his breeding policy some years ago is now achieving 5.08% fat and 3.97% protein in his milk in September.

    With the compositional quality payments applied by his co-op, his milk price is boosted by 5.6p/l above the base level.

    Dairy cow welfare improved at grass

    A review conducted by Dr Gareth Arnott from Queen’s University Belfast and printed in the journal, Animal, has concluded that there are considerable animal welfare benefits to be gained from incorporating grazed grass into dairy production systems.

    The work was funded by AgriSearch, and involved looking at existing scientific literature to compare the welfare of dairy cows in continuously housed and pasture-based systems.

    Lower levels of lameness were observed in pasture-based systems, along with a lower prevalence of mastitis and uterine disease (linked to fertility). Overall, mortality is lower in herds having access to pasture.

    A number of studies have also shown that when offered the choice, cows have a preference for pasture, particularly at night, and that cows outside have improved lying and resting, and display lower levels of aggression.

    However, the report authors recognise that meeting the nutritional needs of the modern dairy cow is one of the main drivers towards housed systems. In particular, the severity of negative energy balance during early lactation may be greater in pasture-based systems, although neither system is ideal in this context, report the authors.

    Also, wind and rain have the potential to reduce cow welfare.

    The report authors conclude that given continuously housed systems are a commercial reality, it is important to build on existing research to improve aspects of dairy cow housing. That includes cubicle design, floor type, loafing areas and environmental enrichment.

    The ultimate aim is to incorporate the welfare benefits of pasture-based systems into these housed environments.