IFA National Dairy Committee Chairman Sean O’Leary has stressed that while EU dairy commodity markets have continued to ease, they still return over 6c/l above GDT prices.
He said farmers and industry commentators need to be aware that ever decreasing amounts of product are being traded through GDT, little of which from Europe, and none of which from Ireland.
“The relevance of GDT results to us Irish dairy farmers is only as an international price discovery mechanism indicative of broad trends. In this regard, it is worth noting that for the main commodities of butter, AMF, SMP and WMP, the GDT results for 2nd June indicate that the prices struck for each of the 6 monthly contracts are on a rising curve,” Mr O’Leary said.
“32% less tonnage has been traded through GDT in the year to date. The products come mostly from New Zealand, Australia and the US, with a very limited amount of product from Europe traded by Arla and Euroserum. There is no Irish involvement in the auction,” he said.
“Meanwhile in Europe, while dairy commodity prices are continuing to ease, they still return substantially more than GDT levels, and we are also witnessing an increase in Italian and Dutch spot milk prices,” he said.
“I would urge co-ops to continue supporting milk prices for peak. This is an extraordinary year for farmers’ cash flow, with superelvy fines, input purchases, the need to share up and/or contribute to the co-ops’ development plans in the context of prices 22% lower than this time last year all playing a part. A great deal of farmers’ confidence and ability to invest and manage their cash flow hinges on the milk price paid for peak months,” he concluded.