IFA National Dairy Committee Chairman Tom Phelan has said farmers appreciate the efforts made by the majority of co-ops this month to hold the March pay-out, though co-ops in many cases made significant cuts to the base price.
He said that poor production conditions continue, with fodder remaining scarce, and grazing still patchy as many had to bring in all the stock they had only just got out after Monday night’s heavy rains.
“I am very clear that farmers will continue to need support from their co-ops over the coming months, and I am very aware that their base price has fallen by up to 6c/l since February. I urge board members, who showed very good initiative in their March milk price decisions, not to lose sight of just how difficult conditions remain on farms when they consider future milk prices,” he said.
“I believe this week’s 2.7% increase in the GDT index, further improvements in EU butter spot prices and firmer cheese and whole milk powder prices are all related to slowing growth in global milk output. The EU and NZ have been affected by weather events which have moderated or reduced output. We may be seeing the beginnings of a rebalancing of markets which Rabobank earlier this month predicted for the 3rd or 4th quarter of the year,” he added.
“This likely better than expected outlook for 2018 should help co-ops continue to remain supportive of very hard-pressed farmers when deciding milk prices and pay-outs over the coming months,” he concluded.