Winter milk producers want chunk of retailers’ payment

Winter milk producers are looking for 39c of the 55c/litre which they say dairies are paid by retailers.

IFA liquid milk committee chairman Teddy Cashman said dairies make at least 20c/l more of a profit from liquid milk than from manufacturing milk.

“Paying farmers a fair price for their fresh, high quality milk over the winter months need not cost hard-pressed consumers a single extra cent, in light of the gross margins of at least 20c/l retailers are currently taking on liquid milk,” he said.

Farmers are demanding a raise because liquid milk production costs have risen 13% due to bad summer weather.

“Most liquid milk payment systems are now based on the manufacturing milk price, with a premium paid for a number of winter months. This means that, as the base price paid to producers has fallen by up to 6c/l fall in response to lower international market prices, winter premiums will need a massive uplift to help liquid milk producers to cover their costs. Where premiums are part of a pre-agreed formula, dairies will have to deliver exceptional payments in recognition of the huge feed cost increases incurred by farmers,” said Mr Cashman.