Dairygold Milk Price Cut Totally Over the Top

Dairygold’s announcement of a 3/c per litre cut to its August milk price has been described as totally over the top by IFA Dairy Chair Martin McElearney.

“We appreciate that butter markets are under pressure and global milk supply is up, but a cut of 3cpl was not expected and has left farmers frustrated and angry,” he said.

For an average sized supplier, this equates to a cut of €1,600 for the August milk cheque.

Global milk supply forecasts have been revised upwards in recent weeks, growing to 1.4-1.6%, which is indicative of ample supply.

At the same time, the futures market for butter has declined to €5,600 – a drop of 11% in one week. However, the latest GDT auction proved relatively stable, only dropping by 0.8%.

“Co-ops need to take a measured response to this correction in the marketplace. Knee jerk reactions undermine farmers’ confidence in our co-op structure. Co-ops must endeavour to return the best price to its suppliers and refrain from drastic cuts,” Martin McElearney concluded.