Co-ops Must Hold Milk Price as Evidence of Recovery Mounts

IFA National Dairy Committee Chairman Kevin Kiersey today (Tues) said as evidence of market recovery was mounting, Glanbia, who cut their April milk price by 3c/l and their May milk price by a further 2.5c/l, must now show real leadership on behalf of their farmer shareholders, and immediately announce an end to milk price cuts for 2012.

“The combined price cut of 5.5c/l will represent a loss of €13,000 in the income of the average 300,000 litre Glanbia supplier over their 2012 supplies, and that is nearly 30% of the average gross dairy farm family income for the last 3 years. In these times of extreme volatility, and in the context of rising input costs, this is a major blow to Glanbia suppliers, and it will make it nigh on impossible for them to make the kind of on-farm investment required to deliver on the post-2015 expansion Glanbia expects of them,” he said.

“Meanwhile, there is more evidence every day that European dairy commodity prices have stopped falling, and are now staging a recovery, as proven by the most recent European quotes. Since the beginning of the month, Dutch butter prices have lifted by€80/t, SMP by €50/t; French quotes for the same products are up €130/t and €50/t, while latest German prices are up €60/t and €50/t respectively” he said.

“Furthermore, the 13.5% increase in last week’s average Fonterra auction price has also influenced the most recent global market quotes positively,” he added

“Members of the IFA National Dairy Committee are currently lobbying their co-ops the length and breadth of the country, and there is now a major opportunity for co-ops to show greater support of their farmer shareholder suppliers than Glanbia has done, by holding their May milk price,” he concluded.

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