Positive news as co-ops increase May milk price

'Dairy markets remain reasonably strong'
Positive news as co-ops increase May milk price

Lakeland Dairies, Glanbia Ireland, Dairygold, and Carbery Group have all increased their May milk price. Picture: Colm Mahady/Fennells.  

Co-ops around the country have increased their May milk price bringing some positive news to dairy farmers this week.

The announcement on the civil aircraft dispute and its impact on the agri-food and drinks trade also signals light at the end of the tunnel for the domestic food and drinks sector.

Meanwhile, Dairygold increased its May Quoted Milk Price by 0.75cpl to 35.75cpl, based on standard constituents of 3.3% Protein and 3.6% Butterfat VAT inclusive. 

This milk price equates to an average May farm gate milk price of 38.7cpl, based on average May milk solids, achieved by Dairygold milk suppliers.

The Quoted Milk Price for May based on EU Standard constituents of 3.4% Protein and 4.2% Butterfat is 39.1cpl.

“We have seen some price fluctuation in global dairy markets in recent weeks, but overall, dairy markets remain reasonably strong against a background of milk supply and market demand being in balance,” a company spokesperson added.

“As is customary, the Dairygold Board will continue to monitor markets closely and review milk price on a month by month basis.” 

Lakeland Dairies 

Lakeland Dairies also increased its base milk price for May by 1.66 cpl to 36 cpl VAT inclusive for milk at 3.6% fat and 3.3% protein in the Republic of Ireland.

This replaces the unconditional bonus that has been paid successively over several months to date.

In Northern Ireland, the co-op has replaced its unconditional bonus with an increase of 1.2p/litre in its base milk price to 29.2p/litre.

Lakeland Dairies said that there is currently a reasonable level of stability in the markets for dairy products.

“European milk supplies have been restricted due to a prolonged period of colder weather to date and this is serving to maintain a level of balance in supply and demand,” a spokesman added.

“While global dairy prices remain prone to fluctuation they are holding steady for now. Demand for food ingredients is recovering on a post-pandemic basis but this is not yet consistently the case across all markets.

“In the foodservice category, it remains to be seen if there is latent demand from consumers to return in large numbers to the foodservice and quick-serve markets as countries worldwide continue a cautious reopening including ongoing vaccination programmes.”

Glanbia 

Glanbia, meanwhile, has indicated that it will pay its Member milk suppliers 35.6 cpl for May creamery milk supplies at 3.6% butterfat and 3.3% protein.

This represents an increase of 1 cpl on the April base price.

Farmer members will also receive a 0.42 cpl (including VAT) payment from Glanbia Co-op on all milk supplied this month as their ‘Share of GI Profit’ and payment will be adjusted to reflect the actual constituents of milk delivered by suppliers.

The Glanbia milk price for May creamery milk, based on LTO constituents of 4.2% butterfat and 3.4% protein, is 38.73 cpl VAT inclusive. 

“Dairy markets are in reasonable balance at present, despite the variable nature of the recovery in demand from the foodservice sector,” Chairman John Murphy said.

“We have seen some price fluctuation in global dairy markets in recent weeks, but overall, dairy markets remain reasonably strong against a background of milk supply and market demand is in balance.

“As is customary, the Dairygold Board will continue to monitor markets closely and review milk price on a month by month basis.”

Carbery

And, Carbery Group increased its milk price for May by 1cpl.

If this decision is replicated across the four West Cork co-ops; Bandon, Barryroe, Drinagh and Lisavaird, this will result in an average price for May of 36.13cpl, inclusive of VAT and 0.5cpl Somatic Cell Count (SCC) bonus.

A spokesperson for the Group confirmed that the increase is due to the relatively stable performance of global dairy markets and ongoing post-pandemic recovery.

“The Board will continue to monitor the situation closely,” he added. 

Aircraft dispute

On Wednesday, the Minister for Agriculture, Food and the Marine, Charlie McConalogue welcomed the “understanding” that has been reached by the European Commission and the US in the long-running civil aircraft dispute.

“The announcement is a very welcome one given the impact that it has had on Ireland-US agri-food and drinks trade over a prolonged period,” continued the Minister.

“The timing is also very positive in light of the challenges that may arise from the trade ‘agreement in principle' announced by the UK and Australia.

“Tariffs imposed by the EU and the US in this dispute, which are currently suspended until July 11, will be suspended under the announcement for a further period of five years.

"Lifting this tariff burden in the civil aircraft dispute, which equated to €95m on impacted Irish agri-food exports of €380m in 2020, will help Irish agri-food exporters to the US as they emerge from the Covid-19 pandemic.

“Furthermore, the suspension of these tariffs for five years also gives Irish importers certainty with regard to long term contracts.”

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