The Ornua Purchase Price Index (PPI) for July is unchanged from the previous month, although the indicative price return has decreased slightly.
The PPI for last month is 140.8, the same figure for June. However, Ornua said that the PPI this time around implies an indicative return of 41.1c/L, inclusive of VAT at 4.8%, for milk at 3.6% fat and 3.3% protein.
These figures are net of Ornua’s costs to market.
This indicative return is a decrease of 0.4c/L compared to the 41.5c/L for June.
The figure was arrived at after deducting Ornua’s member co-operative processing costs, which were reckoned at 9c/L for July.
Under the new method for determining processing costs, introduced earlier this year, the processing costs indexes the variable elements to external indices which are updated quarterly in arrears.
The processing costs will rise or fall quarterly in line with the movements in the variable elements (most notably energy) as per the external indices.
As July commences a new quarter of the year, the processing cost have been updated to 9c/L, an increase of 0.4c/L compared to the 8.6c/L processing cost for each of the previous three months.
In addition to the latest PPI figure, Ornua said that its value payment payable to member co-operatives in the month is €7 million, which equated to 3.9% of gross purchases in the month.
Ornua said that the PPI “related to product settlements [or] payments for the month and, for reasons of seasonality, is not directly aligned with milk production and payment”.
In other dairy market news, the average Global Dairy Trade (GDT) price index rose by 0.5% according to the latest auction results published yesterday (Tuesday, August 6).
There were a total of 186 bidders in the event which saw 35,965 metric tonnes (mt) of product sold.
The average selling price was €3,356/mt in the auction, which lasted for more than two and half hours, during which there were 133 winning bidders and 18 bidding rounds.
The GDT price index after yesterday’s event now stands at 1,087, compared to the previous index figure at 1,081.
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