Based on the latest market returns and milk prices quoted from European milk processors, there is growing evidence to suggest that the dairy markets continue to rebound with confidence according to Mr. Pat McCormack, Deputy President and Chairperson of ICMSA’s Dairy Committee.
Friesland Campina, the Dutch Dairy Co-operative, have increased their milk price for the second month running. For March, its milk price now stands at €34/100kg’s (35cpl). This is an increase of €2.50/100kg’s (2.57cpl) from last month. This provides a clear indication of the level of confidence at processor level in mainland Europe and this confidence should be reflected back to Irish farmers from their Co-ops who are currently below this price level at 30.5 cpl.
Mr. McCormack said that other market indicators are positive including the Global Dairy Trade Auction which rose for the sixth consecutive time last Tuesday. There were significant gains, in particular, for a number of products within the latest GDT auction with cheddar increasing by 10.8%, SMP increasing by 5.9% and butter by 2.5%. Dutch Dairy quotation are also rebounding in the last number of months with butter/SMP returns up 21% since their lowest point in December and WMP up 23% in that timeframe also. These indicators all point to a strong dairy market and given the indications of a continued tightening in the global supply situation due to drought in New Zealand, lower milk production globally due to reduced prices as well as reductions in European supplies due to impending superlevy, dairy farmers can be optimistic regarding milk price for 2015.
Cash-flow is a major issue on dairy farms at this time of year and in particular this year due to superlevy problems and thus every cent counts and it is essential that Co-ops recognise this fact, recognise the improved market returns and pass back the maximum returns possible to their suppliers, concluded Mr. McCormack.
ENDS. 06 March 2015
Pat McCormack is at (087) 7608958.