IFA National Dairy Committee Chairman Sean O’Leary said today’s GDT auction has again showed the continuing strength of butterfat prices, with butter up 3.8% and AMF 3.6%.
Taken together with continued strong European market return trends, it is clear that a price increase on August milk of at least 1c/l is fully justified.
He said IFA National Dairy Committee members are this week getting in touch with their co-ops’ board members to discuss the reasons why such an increase is not only fully justified by the market trends, but also still badly needed to help farmers’ financial situation to recover after three years of poor prices and cash flow challenges.
“35 to 40% of the national milk output is produced between August and December annually. With significant increases in output, and good production conditions well into the summer, this proportion may even be higher this year. The point is that every cent passed back to farmers will make a significant difference to their overall financial position, after three years of low prices and challenging cash flow.
“European returns for the end of August rose with the butter and WMP prices to a gross 41c/l equivalent, before processing costs.
“A price increase of at least 1c/l must be passed back to dairy farmers for their August supplies,” Sean O’Leary said.