Speaking ahead of the June milk price announcements by local dairy processors, UFU dairy chairman Mervyn Gordon repeated the call for better returns for local milk producers.
“The fall in base milk price in recent months has been completely unjustified. Up until the end of May, the GDT index rose at 12 consecutive trading events. However, since September 2018, the average base price for milk has fallen by over 2p per litre. UFU members are asking the question - why despite seeing decent returns in the markets, especially closer to home, are these returns not being passed back to farmers in the form of their monthly milk cheque?” said Mr Gordon.
The UFU dairy chairman says the importance of New Zealand dairy data in recent months has been overplayed.
“If you look closer to home, key dairy commodities in European markets are providing decent returns, despite the fact that butter prices have cooled,” he said.
Last week Ornua in the Republic of Ireland announced an improved Purchase Price Index (PPI), which for the month of May is showing an increase to 107.3 (up from 105.9), the highest PPI figure for the month of May in the last five years.
“The PPI is a measure of dairy products purchased by Ornua - typically butter, cheese, whole milk powder and protein products and is an accurate reflector of pricing of a broad dairy product mix. Local dairy processors must consider market trends closer to home and share returns with primary producers,” said Mr Gordon.