Milk price ‘should be maintained’
Expressing disappointment at Kerry’s decision to cut milk price by two cent a gallon for May and by another 2c a gallon for June, he said these reductions could not be justified.
He said there are no cuts on the horizon from the market place. The reality is that the Irish Dairy Board (IDB) on account price is the same today as it was last August. Currently, there are virtually no stocks of skim milk powder in intervention.
He said the market was actually in balance and could improve later in the year. In addition, the recent sale of 19,000 tonnes of skim milk powder to Algeria by EU suppliers will further strengthen the market.
Mr Cronin also said a number of factors point to a possible improvement in the butter market later in the year but at present intervention is providing a floor price.
Production in New Zealand is down by 3%-5%, which is having a positive effect on world prices.
With this tight supply situation on the EU and world markets, milk price should be maintained rather than reduced.
Against this background, and with no likely cut by the IDB in its price, board members of co-ops should hold current milk prices going forward, he said.
Glanbia, which cut its milk price by four cent per gallon last month, said the move was a direct result of EU support cuts arising from the Common Agricultural Policy (CAP) mid term review.
