Major price cuts by co-ops in the last two months, added to very poor weather, depressing volumes and constituents, and increasing feed costs, have eroded margins massively and caused major hardship and frustration for dairy farmers, according to the Irish Farmers' Association (IFA). Co-ops must continue to support farmers with the strongest possible milk price for April, according to IFA national dairy committee chairman, Tom Phelan.
“In this respect, and after Lakeland held their base price, the move by Glanbia to cut both base price and support was disappointing, and I urge other co-ops to do better,” he said.
“Market returns fell between September 2017 and January 2018. But since then, they have been firming steadily. The EU Milk Monitor Observatory (MMO) has reported that butter prices have recovered to €5,450/t, more than double what they were two years ago, while skimmed milk powder prices have increased by €90/t since last March. Whole milk prices are up close on €200/t since January, while cheddar cheese prices have lifted €100/t since early April.
“Latest EU MMO dairy price reports for May 6, suggest a milk price equivalent of 31c/l + VAT after deduction of a nominal 5c/l processing cost,” he added.
“Co-ops are now starting to benefit from firmer returns, and they must use this to continue supporting farmers through a very tough time,” said Mr Phelan.