ICMSA ‘disappointed’ as some processors cut July milk price
Deputy president Pat McCormack said the ICMSA is concerned that the price decisions took too much account of dairy product price movements in August.
August price movements are generally ‘out of sync’ with other periods and are an unreliable indicator, he said.
Mr McCormack, who is also chairperson of ICMSA’s dairy committee, said the reductions in milk price since the start of the summer are of huge concern to dairy farmers.
Along with super levy concerns, he said these will have a major negative impact on farm incomes this year. While dairy markets have weakened, too much should not be read into price movements at present.
August is the traditional holiday period and would be expected to have a negative impact on prices.
“While recent auctions in the Global Dairy Trade have seen markets soften, it is expected that buyers who have been away from the market will return in the coming months.
“Secondly, peak production in Europe, our main market for dairy products, has well passed and, together with the prospect of significant quota-overrun and super levy in key producer states, we should see some easing of the pressure on prices.
“We’ll have to wait and see how production in New Zealand and the Southern Hemisphere fares in the coming months because that will clearly have a major impact on milk price as we head into 2015,” he said.
Mr McCormack said there are plenty of positives in the market, including increased butter usage.
