Meaningful base milk price increase overdue, says UFU

UFU dairy chair Kenny Hawkes said: “Whilst the winter bonus will be welcomed by dairy producers helping to offset high input costs, it should not be used by processors to hide true and justified increases in base prices.

"NI dairy producers should have already seen a 1ppl increase in the base price, yet processors are saying that dairy farmers are unlikely to see an increase until late winter. Instead, NI has the third worst milk price in Europe with one major dairy company lagging further behind its competitors. The need for farmers to see a meaningful increase in their base milk price is long overdue. This is the third time since 2017 that the UFU has highlighted that bonus payments have masked true increases in base prices and what farmers are receiving.”

Dairy commodity market prices of key products have been increasing since early September.

“The upsurge in the last three months has seen butter increasing to €1,250/tonne and skimmed milk powder by €450/tonne. Milk and cheese prices after a period in the doldrums have also started to rise. Positive sentiments have been reflected in future dairy prices with the latest UFU milk price index showing an 11 per cent increase in the same period. As well as recovering commodity prices, milk volumes are falling, and this would signal stronger base milk prices for the winter, yet local processors seem to have ignored dairy commodity indicators.

“With further increases in the base price anticipated and signs pointing towards a market where there are gains to be made, the UFU want to see the increase in commodity prices passed back through the supply chain - not delayed until the tail-end of the most expensive period on a dairy farm. If processors are going to guarantee much needed supplies, they will need to step up to the mark and pay an improved base milk price,” said Mr Hawkes.