ICMSA questions processors’ ‘negative vibes’ on milk

THE ICMSA has taken issue with the “negative vibes” regarding milk prices that have been expressed of late by the major dairy processors, writes Declan O’Brien.

Pointing out that Irish milk prices remained bottom of the league in terms of EU returns, and just 1.5c/l ahead of Fonterra, Gerald Quain of ICMSA described the talking down of milk markets as “disappointing and unjustified”.

“The reality for the Irish dairy farmers is that their milk price is among the lowest in the EU. We sell produce into many of the same markets as these EU processors, and Irish farmers are rightly asking the question why our milk processors are talking down milk price,” Mr Quain said.

Although Mr Quain conceded that dairy markets had come under pressure in recent weeks, he pointed out that continental processors had continued to support their farmers.

Over the fortnight both Glanbia and Dairygold, although they held milk prices, have cautioned farmers that global dairy markets have come under pressure as a result of increased production across Europe and in New Zealand.

“This surge in milk supply has coincided with a very strong start to the New Zealand milk production season, with a cumulative 15pc drop in the GDT price index since June resulting in reduced forecast milk prices,” said Glanbia chairman Martin Keane.

“It should also be noted that there has been a rapid decline in European butter markets, with Dutch Dairy Board’s reported prices down from €6,100 per tonne in June to €4,700 per tonne this week.”

Meanwhile, LacPatrick is the latest processor to hold its milk price for September. It will pay 32c/l including VAT. Aurivo last week announced that it would remain on 32c/l, while Arrabawn held on 32.2c/l.