13 01 2020
IFA National Dairy Chairman Tom Phelan today said Lakeland Dairies Co-op, by increasing their December price by 1c/l, had shown the way for other co-ops to follow.
The Ornua PPI for last month had increased to a milk price equivalent to 32.3c/l incl VAT, nearly 2c/l more than the average paid by co-ops for November – generalised milk price increases are well and truly overdue.
Mr Phelan urged the other co-op boards who will be deciding December milk prices this week, to follow the Lakeland example for December, and in order to get back to paying a sustainable milk price for 2020, to plan for further increases before the new season commences.
“We monitor market indicators for Europe and the global market, and calculate the milk price equivalent from the dairy commodity prices reported. Those have improved quite significantly over the last 5 to 6 months, as shown in the graph,” Mr Phelan said.
“Still, our co-ops have not increased milk prices as much as they clearly can, and we urge them to correct the situation ahead of spring. The high solids which underpinned milk cheques in the autumn will have crashed when milking resumes next month, and farmers will find themselves under serious cash flow pressure,” he said.
“A milk price increase of 1c/l on December milk supplies is the minimum co-ops must pass back to farmers, but they must also start planning to deliver sustainable milk prices for 2020, and this will require further increases before the season recommences,” he concluded.
IFA National Dairy Committee Chairman Tom Phelan has called for the urgent publication of the detailed provisions of the Calf Investment Scheme, which is to open for applications today, 7th January. It was announced before Christmas by the Minister for Agriculture, Michael Creed.
Tom Phelan added that additional funds must be provided in the case of oversubscription.
“The scheme is an important element in supporting farmers who will need to manage increased numbers of dairy calves next spring. While the €1.5m funding is welcome, this is equivalent to only €1 per calf born within the dairy herd. Should the scheme be oversubscribed, it would be vital that additional funding would be made available,” Mr Phelan said.
“An informative FAQ has been published, but there are no detailed specs available for the type of equipment which will be deemed eligible, nor is there any indication of how quickly farmers will know whether their application has been approved. Given the need for farmers to take prompt action before the impending calving period, it is crucial that the fullest details be published by the Department urgently,” he concluded.
IFA National Dairy Chairman Tom Phelan has welcomed the announcement by Minister for Agriculture Michael Creed of a €1.5m grant aid support package for calf feeding systems.
10 12 2019
Speaking as Ornua lifts their PPI for the third month running, IFA National Dairy Committee Chairman Tom Phelan today pointed out that, in the last few days, the following has been reported:
- Ornua’s PPI for November has risen a further 1 point to 106.6 points or 31.9c/l incl VAT;
- Fonterra have increased their 2019/20 payout to a mid-range point of NZ$7.30/kg MS (equivalent to 31.23c/l incl VAT at Irish standard solids);
- GDT SMP prices have reached their highest level in 5 years at US$3068/t, and WMP the highest in 3 years at US$3331/t;
- Friesland Campina have lifted their December price €0.91/100 kgs to €36.41/100 kgs (32.62c/l incl VAT at Irish standard solids);
- EU average SMP prices have lifted to €2500/t for the first time since August 2014;
- EU average butter prices have risen €30/t to €3660/t in the last week;
- EU average raw milk prices have increased 4.5% since July;
“All these facts point to steadily improving returns from the market place justifying better farm gate milk prices, because there is a good balance between slower milk supply with low stocks, and solid demand growth,” Mr Phelan said.
“There can be no justification for Irish co-ops not to move on the November milk price, when the lowest payers are nearly 3c/l below the Ornua PPI,” he said.
“This month, our message to co-op board members is clear: stop dragging your heels on milk prices, and pay farmers the extra 1 to 2c/l on November milk that their cash flow is crying out for,” he concluded.