05 Oct 2016
ORNUA PPI 6.4 POINTS SURGE VINDICATES IFA CALL FOR AT LEAST 2C/L PRICE LIFTDairy
IFA National Dairy Chairman Sean O’Leary today pointed out that the 6.4 points surge in the Ornua September PPI put it ahead of 2015 levels for the first time.
He said at 92.2 points, equivalent to 26.6c/l including VAT according to Ornua’s own calculations, this vindicated IFA’s call for a minimum 2c/l increase by all milk purchasers for September milk.
“It comes as no surprise that the Ornua PPI is following the rising trend in EU average dairy market returns, which we have been pointing to for the last five months. While average EU market prices may not reflect the balance of fixed and forward sold contracts of individual processing co-ops, it is clear that the Ornua PPI reflects the returns for the products traded through them, and that is 60% of all milk exported,” Mr O’Leary said.
“We have already urged co-op boards, who will be meeting in coming days, to increase the September milk price by at least 2c/l to reflect strong improvements in market returns, and to support farmers who, despite recent price uplifts, continue to produce milk below costs. This latest PPI increase validates our belief that such increase is entirely justified,” Sean O’Leary concluded.