Kerry Group pays more to suppliers

KERRY GROUP has further increased the price it pays its suppliers for milk, due to continued improved returns from international dairy markets.

It confirmed that its suppliers’ milk price payment will increase by a further 11.3 cent per gallon (2.5 cent per litre) to 165.9 cents per gallon (36.5 cent per litre) for deliveries from August 1. This brings the cumulative milk price increase in 2007 to 49 cent per gallon (11c/l).

IFA Dairy Committee chairman Richard Kennedy said that milk prices paid in some parts of Europe were already exceeding 40c/l, with more price increases expected.

Colleagues in Germany, Austria, the Netherlands and Britain indicated that the processors best able to pay well over 40c/l are those with strong commodity elements in their product mixes.

“Most of our co-ops are in that position,” he said, claiming that they are clearly better placed than most around Europe to benefit in terms of returns from the commodity-led market boom and can easily afford to pay 40c/l + VAT for August milk.

ICMSA Dairy Committee chairman Dominic Cronin said an alarming gap exists between what co-ops are receiving for their products and the price they are returning to their milk suppliers.

He said the ICMSA firmly believes that the milk price paid by co-ops must reach 40c/litre for August milk exclusive of VAT.

Meanwhile, IFA Munster vice-president Sean O’Leary has welcomed what he described as a commitment from Dairygold chief executive Jerry Henchy that the society will pay the maximum milk price possible to farmers over the coming months.