The Deputy President of ICMSA and chairperson of its Dairy Committee, Pat McCormack, said that based on market returns, farmers are fully justified in demanding further milk price increases and a milk price in excess of 33 cents per litre is now due.
Mr McCormack said that given the difficult weather conditions and the resultant massive cost implications for farmers every cent per litre is absolutely critical for farmers and Co-op boards must pass back the maximum return to farmers. All the market indicators are positive including the Irish Dairy Board milk price index - which has increased again in October – as well as Dutch Dairy Quotations, Northern Ireland Milk Auction and the Global Dairy Trade Auction. These and other indicators all point to a strong dairy market and in the context of a tight global supply situation, dairy farmers are optimistic of further milk price increases and expect their board members to deliver for them. In particular, given the situation in the US whose milk production is a key driver of global dairy product prices, indications are that the culling rate is high and heifers numbers are falling which should add to an already tight world supply situation, noted Mr McCormack.
“Cashflow is now a major issue on dairy farms and literally every cent counts. The Co-op boards have to recognise this fact, recognise the improved – and still improving - market returns and pass back the maximum returns possible to their suppliers. A milk price in excess of 33 cents per litre is now fully justified”, concluded Mr. McCormack.