IFA leader takes Kerry to task over July milk prices

Prices

IFA leader takes Kerry to task over July milk prices

IFA president Joe Healy has taken Kerry to task over its failure to move on July milk prices.

He said Kerry clearly chose not to pass on the benefits of improved dairy markets, which their neighbour Dairygold passed back with a July milk price increase of 1.5cpl and other co-ops passed back with increases of 1cpl.

“Kerry has got it wrong and must revisit this decision for the sake of their cash strapped suppliers,” said Mr Healy.

The IFA president said Kerry’s failure to move on milk prices when dairy commodities are recovering rapidly clearly ignores their suppliers’ needs and expectations, and comes after their poor showing in the 2015 Farmers’ Journal / KPMG Review.

“Kerry suppliers are under as much financial and cash flow pressure as all other dairy farmers. Kerry must do the right thing and urgently revisit their milk price decision,” he said.

Meanwhile, Mr Healy said that there must be no stalling by co-ops on further milk price increases, and he would meet them in person to convey this message over the coming weeks.

Major milk price improvements were both necessary to boost farmer confidence and their badly damaged cash flow and justified by a real market recovery, he said

Mr Healy called on co-ops that had yet to decide on the July price, especially those at the bottom of the league, to first follow the Lakeland, Glanbia and Arrabawn example by increasing July prices, but also for all co-ops to budget and plan for significant further milk price increases for August and beyond.

“Co-ops can be confident about increasing milk prices: the long awaited dairy market recovery has really taken hold. It reflects much slower growth or even decreased milk production in Europe, but also globally, and relatively healthy demand growth despite the Russian ban and lower oil revenues,” he said.

Mr Healy was supported by IFA dairy commitee chairman Sean O'Leary who said the continued strengthening of all dairy market indicators augured well for further price increases.

He said spot quotes, average reported prices, the GDT auction and futures markets were all on the up in the last week again, reflecting lower milk availability globally and positive demand growth, and further proving that the long awaited dairy recovery was taking hold.

“Farmers badly need significant further price increases for August milk and beyond, and co-ops must now work on delivering on farmers’ legitimate and realistic price expectations,” he said.

However, Mr O'Leary warned Minister Creed must show much greater urgency to introduce the IFA proposed low cost, flexible cash flow loans with built-in repayment breaks, as improving milk prices and beyond will not suffice to solve farmers’ 2016 cash flow difficulties. “They must now bring forward the type of financial package we have proposed with the very same urgency as if the outlook for milk prices were less positive.” he said