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Milk Price Analysis shows gaps between what processors are paying

A new milk price analysis completed by the IFA Dairy Committee shows significant differences between the milk price paid by 11 milk processors across the country.

The analysis is based on the revenue generated in 2019 and 2020 by a spring calving herd supplying 500,000 litres a year to their milk processor. It was based on 89 cows producing 500,000l through a spring calving system using the Teagasc Moorepark spring-calving supply profile, and assumed that each farmer produced milk with average solids each month. Any bonuses related to trading activity were excluded. Fixed price schemes and forward price contracts were also excluded. 11 of the largest milk processors were compared.

The 2019 analysis shows a gap of €16,481 between the highest and lowest payers. In 2020, the gap has widened to €16,896.

The analysis, completed by the IFA Committee with Senior Dairy Policy Executive Aine O’Connell, is based on milk statements supplied by farmers to the dairy committee. It ranks processors in order of the annual income that would be generated and is adjusted for milk constituents.

The Chairman of the Committee Stephen Arthur said the purpose of this analysis is to allow farmers to compare prices paid by milk processors on a like-for-like basis. “Dairy farmers have been working hard to improve their milk constituents over the years. This can give the impression that milk price has improved, when in reality it’s the milk quality that has improved,” he said.

“This has masked the fact milk price is effectively the same over the past 30 years. We believe the analysis will provide more price transparency, and we plan to publish it on an annual basis.”

To see where your processor finished in the table, click https://www.ifa.ie/MPAReport