Calls have been made for a 37 c/L milk price for November milk as supplies to co-ops take a 12.6pc drop and modest gains in international trade.
The latest Global Dairy Trade (GDT) auction saw modest gains continue with the average price index up by 1.6pc to €3080.79, and increases seen across all products. However, analysts say Chinese demand remains “comparatively muted”, while lower volumes on the GDT are partly behind recent gains.
Analysis by New Zealand bank ASB says the “key headwind to future recovery in dairy prices remains the comparative absence of Chinese demand”. It goes on to say that while Chinese growth forecasts have recently been revised higher, output next year still looks likely to remain below the historical trend.
“In our view, that’s still a recipe for comparatively muted global dairy demand.”
At home, the latest figures from the CSO show that milk intake by co-ops was estimated at 605m litres in October 2023, a decrease of 87.2m litres (-12.6pc) when compared with October 2022, and down 44.6m litres (-6.9pc) when compared with October 2021.
In the months from January to October 2023, milk intake was estimated at almost 7.9bn litres, a decline of 169.4m litres (-2.1pc) when compared with the corresponding period for 2022.
Chairperson of ICMSA’s Dairy Committee, Noel Murphy has called for a succession of price rises from co-ops in the coming months.
“Irish dairy farmers have experienced an extremely difficult year, and it is hugely frustrating that our milk processors, who have seen dairy product prices increase substantially since the start of September, have taken the decision to sit on these increases rather than pass them back to the farmers, who have been producing milk below the cost of production for months now”, said Mr Murphy.
“Farmers have voted with their feet and dried off cows. That’s going to continue until and unless milk processors wake up to the reality that many farmers are not in a position to pay their bills this year.
“Milk processors are very good at preaching sustainability to farmers but they need to deliver sustainable prices. Based on the ICMSA milk tracker, Dairygold, Tirlan, Tipperary, North Cork and Aurivo are at the bottom of the milk price league representing a very substantial percentage of Irish milk.”
Mr Murphy said that farmgate prices increases must begin with a minimum 37 c/L for November milk.
He said that single cent increases were now no longer acceptable and that processors must “begin restoring farmer confidence after what had been a frankly brutal period.”
