Newly elected IFA National Dairy Committee chairman, Sean O’Leary, said the bounce in dairy market prices is evident from the most recent Fonterra auction, the latest spot quotes and average EU prices published by the European Commission — all positive indicators.
He said this should make it easier for co-ops to make early and solid commitments for milk prices — at least at current level well — into 2014.
Mr O’Leary said the IFA stands by its analysis that continued buoyant dairy markets during 2013 generated as much as €80m more than has been passed to farmers.
While 2013 ends on a very positive note for dairy farming in Ireland, most producers are still paying outstanding input bills accumulated over the previous 18 months and during the fodder crisis, he said.
“It is clear that demand, driven by shortages among other importers, China and Russia, is holding up quite strongly in the face of the pick-up in output from New Zealand, the US and the EU.
“Irish co-ops must end the year with a fully justified, affordable, and necessary confidence boost to their suppliers by passing back more from the buoyancy of 2013, and committing to at least hold current prices well into 2014,” he said.
The Irish Creamery Milk Suppliers Association has also predicted that milk prices will continue to remain strong for at least the first half of 2014.
Deputy president Pat McCormack said he based the prediction on two recent major market indicators that clearly highlighted ongoing momentum in dairy prices.
A 3.9% increase in the Global Dairy Trade auction reflected strong demand for products such as casein, butter and skim milk powder (SMP), while Dutch dairy quotations reflected a stronger market for dairy products in the EU.
Mr McCormack said the ICMSA is particularly encouraged by the fact Dutch quotations have shown improvements since October when they had dipped slightly.