Commenting on the publication of IFA’s 2022 Milk Price Analysis, IFA National Dairy Committee Chair Stephen Arthur said the analysis continues to provide greater transparency within the dairy sector and enables the IFA to seek better prices for dairy farmers.
You can read the IFA 2022 Milk Price Analysis in full here.
“This annual analysis ranks milk processors in terms of total milk receipts a typical spring calving herd would earn in each processor. It removes all the smoke and mirrors surrounding milk price and lays it out in black and white as to who is paying the most, and the least, for their milk. The gap between the top and the bottom ranking grew this year to almost €15,000, which is more than double last year’s gap,” Stephen Arthur said.
All milk processors have adopted the A+B-C methodology for calculating milk value. In addition to this, applicable bonuses and VAT were added to give the total milk value. Where ‘13th payments’ were paid, this was added to the total revenue for that particular processor. the analysis excludes any bonuses that are dependent on trade with the processor and also any sustainability payments that require farmers to commit to undertake further action on their farms.
“These bonuses are artificial. There is no extra pot of money for such measures so very quickly such bonuses erode the underlying base price of milk,” he said.
Reflecting on the year, Stephen Arthur said while milk receipts were considerably greater in 2022, we are very aware that farmers with milk volumes in fixed milk price contracts received significantly less. The analysis does not capture the negative impact fixed milk price contracts have had on incomes in 2022.
“This is the fourth year of the analysis which is proving itself to be a valuable tool for the industry. We will continue to use this analysis to lobby for better returns for farmers from their milk processers,” he concluded.