Base milk price should be rising - UFU chairman

editorial image

The Ulster Farmers’ Union says that it expects the base milk price to rise and if not processors need to explain why market gains are not being shared with primary producers.

UFU dairy chairman William Irvine said dairy commodity prices have stabilised and in fact there have been two weeks of strong returns at key global dairy auctions.

He added: “The UFU MPI has increased by nearly a penny during the same period. This leads us to question, when will we see an increase in base milk price here?”

Mr Irvine added that farmers are already feeling short-changed. There has been minimal increase in base milk price over recent months and the long awaited exchange rate boost, promised by processors, is still yet to materialise.

“You can understand why dairy farmers are closely scrutinising milk cheque statements. It is clear that there are profits being made but not shared,” says the dairy chairman.

He said the impetus is now on dairy processors to at the very least stabilise base price for April milk, and also to increase price for peak supply volumes. “If dairy processors are serious about securing their supplier base in the future, they must demonstrate a willingness to pay their suppliers a sustainable milk price that accurately reflects the market,” says Mr Irvine.

Meanwhile in the Republic of Ireland, IFA milk committee chairman Sean O’Leary is calling on the dairy co-ops to increase milk prices by 1c/L this month.

“The price increases recorded at last week’s Global Dairy Trade event in New Zealand are encouraging. We are now seeing a stronger trend developing, where world dairy markets are concerned. And this is good news for dairy farmers,” he added.

O’Leary said that the stabilisation in skimmed milk powder prices, recorded in both New Zealand and Europe over recent weeks, is particularly encouraging.

“This is an extremely positive development, given that the Irish dairy industry is about to reach peak milk output.”

The latest figures from the European Commission indicate that EU wholesale markets weakened in April for most products, with the exception of butter and whey powder. Cheese prices dropped compared to the previous month for all reported varieties, with Cheddar and Edam showing the largest fall in average price. Powders, however, are still in oversupply, with no sales of intervention stocks yet again at the latest tender. As such, prices are struggling to rise much above the intervention price of €1,698/tonne.