Dairy Council Report October 2020

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Dairy Council Report October 2020
09 Oct 2020

Dairy Council Report October 2020

Council Reports, Dairy Reports

Milk Price

The Ornua PPI for August was 101.8 (29.4 c/L). This includes a 7c processing charge and does not include the Ornua Value Payment. This bonus amount to €3.4m for the month of August. Taking account of this, the IFA adjusted PPI amounts to 30.8 c/L, including VAT.

The Farmgate price paid for milk (3.6% fat and 3.3.% protein) for the 6 main milk processors ranged from 30.6 c/L to 31.5 c/L, including bonuses and VAT.

July August
Ornua PPI 101.7 101.8
Ornua PPI (c/L) 29.3 29.4
Ornua Value Payment €3.2m €3.4m
Adjusted PPI (c/L) 30.29 30.8

 

Processor PROTEIN €/kg c/L protein value FAT €/kg c/L fat value VOLUME CHARGE A+B-C Bonus VAT Standard price
DAIRYGOLD 5.73 19.48 3.50 12.99 4.00 28.47 0.65 1.57 30.69
KERRY 5.69 19.35 3.80 14.07 4.00 29.42 0.5 1.62 31.54
LAKELANDS 6.23 21.16 3.17 11.76 3.50 29.42 0 1.59 31.01
GLANBIA 5.98 20.33 3.60 12.31 4.00 28.64 0.42 1.57 30.63
AURIVO 5.94 20.20 3.46 12.82 4.25 28.77 0.65 1.59 31.01
ARRABAWN 6.27 21.33 3.10 11.48 3.35 29.46 0.2 1.60 31.26

Domestic supply has increased by 3.5% YTD. Global supply is also strong with growth at 1.5%. this is forecast to increase to 1.6 – 2% by year end. After the initial shock of lockdown and the closure of foodservice outlets, consumption has recovered and is only back about 2-5%. Demand has remained steady so far, but it assumed this is due to countries stockpiling rather than a critical demand for product.

Exports to date are ahead of last year and have already broke the €3bn mark. Prices paid for butter have reduced substantially. Exports to Great Britain are back 14%

As milk processors begin to set prices for milk supplied in September, we are seeking a milk price increase of 1c/L, especially from those that didn’t increase base price last month. Given stronger exports, reduced milk supply in the backend and the upcoming holiday season we feel that this petition is justified.

Brexit

In the event of a no-deal Brexit, tariffs for butter and cheddar would be €174/100kg and €153/100kg, respectively.

Activities

The dairy committee met with Sean Coughlan from ICBF

Dairy herd F% P% kgMS 6 week
2010 3.85 3.37 359 52%
2019 4.17 3.53 419 65%
  • Genomic bias came about over 2 main reasons
    • Females introduced into the training population in January
    • 19% of sires had a sire in the training population
  • Bias will be accounted for in the October run
  • Changes to EBI will be small for cows in the next EBI run
  • Almost impossible to get a daughter proven bull for fertility – bull would be 8-9 years old before enough proofs for fertility would be obtained.
  • Genomic predictions for milk production are better than genomic predictions for fertility.

Issues

The new veterinary medicines regulation is due to commence in January 2022. This will require all dairy farmers to adopt selective dry cow therapy (SDCT). Farmers will need considerable support during this transition from industry. The main points we will be lobbying for are:

  1. Assistance from AHI and milk processors to garner awareness on knowledge and to provide adequate training resources.
  2. Adequate capacity of milk recording companies to accommodate increased rates of milk recording.
  3. Easing of SCC penalties imposed by milk processors during the transition.
Chairman Tom Phelan
Executive Aine O’Connell
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