Glanbia Milk Price Move Begs Questions – Downey
IFA President Eddie Downey said that the decision by the Glanbia Board to cut their base milk price by 1c/l to 24c/l, even allowing for the 1c/l co-op topping it up to 25c/l including VAT, would leave its suppliers bitterly disappointed, and is raising questions on the pricing model that GII is pursuing. At a time when a market recovery is underway, this decision is a serious confidence blow to Glanbia suppliers facing into an expensive winter.
“Farmers are under tremendous cash flow pressure, and needed to see their price at least maintained, and both Lakeland and Kerry must be commended on holding their September milk price. All other processors must follow their lead and maintain prices,” Mr Downey said.
“Glanbia shareholder suppliers legitimately expect that GII, the largest milk purchaser and processor in the country, would have the scale, efficiency and product mix advantages allowing it to pay, without co-op contributions, the most competitive milk price,” he said.
“Glanbia farmers are now concerned that the pricing policy adopted by Glanbia is leaving them at a significant price disadvantage to other co-ops. How can this be?” Mr Downey questioned.
Mr Downey called on the Board of GII to review their approach on milk pricing.
Commenting on the price cut, IFA National Dairy Chairman Sean O’Leary added: “Glanbia could have held their milk price and total payout for September. Markets have been firming over the last two months and a recovery is now hopefully underway. Glanbia suppliers are bitterly disappointed with this move, and I ask the Board to make a solid commitment on reviewing their pricing policy”.