Liquid milk 40cpl cost of production

The average liquid milk producer has been spending 40c to produce a litre of milk over the past two years, according to an accountant’s report at the recent Fresh Milk Producers 2016 Conference.

Commissioned by FMP, Barry Murphy, an accountant with FDC, said when a modest labour cost of €45,000 per annum per full-time family farmer is taken into account, 40c per litre is the total cost.

He said labour and capital expenditure need to be included when analysing profitability of any business.

He said: “Control of variable costs is key, and farmers should remember that scale is not everything. In fact, scale contributes added pressure, and if efficiency does not exist in the first instance, further financial problems will follow”.

Psychotherapist Karl Melvin spoke to members about the importance of managing stress.

He said: “While we cannot change some of the factors that are causing stress, farmers need to work towards managing them”.

Fresh Milk Producers is a section of the IFA, representing over 1,000 liquid milk suppliers in 15 local liquid milk groups in the Glanbia and Cork regions, supplying Glanbia.

It negotiates on liquid milk price directly with Glanbia on an ongoing basis.