Milk prices

All eyes on co-ops after Lakeland's 1cpl increase

Tipperary Star reporter

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All eyes on co-ops after Lakeland's 1cpl increase

The ICMSA has expressed it “anger and disappointment” over a 1cpl rise in the October milk price by Lakeland.

And with other co-ops due to meet this week to decide their October price, ICMSA dairy chair Gerald Quain said “all eyes will now be turning to them”.

He said that Lakeland suppliers had been contacting his organisation since the announcement that they were raising their October milk price by a single cent to 27cpl.

Mr Quain described it as a transparent decision to sit on the increased market returns and pass back the increases to their suppliers as slowly as possible.

He said it would be difficult to convey the frustration and astonishment expressed by the farmers who had contacted ICMSA to point out that the Lakelands price, even after the derisory single cent rise – was actually below the price equivalent to the Ornua price index.

Mr Quain said that all eyes were now on the other processors who had “better realise that this kind of tactic was laying down the conditions for disagreement and suspicion in the future”.

It was, he said, simply unfair to expect farmers to sit quietly and passively while being paid a price that was “demonstrably” 3cpl less than it should be.

“ICMSA is cognisant of the difficulties that the Sterling differential is now causing the agri-food sector with a lot of exposure to the UK market, but Lakelands and all the others would want to remember that we can break-down market returns and do the count on that side as well and when we do the break-down on that side we see that the market is returning 30cpl. ,” he said.

Mr Quaine sai that ICMSA will not tolerate a situation where processors were continuously hiding behind current or developing situations to hang on to monies they’ve already been paid and should be passing back to their suppliers.

All eyes will now turn to the other processors and we’d better see some sign that they understand that they will not be allowed sit on money that – by any standards of fairness – they should be paying out in turn to their suppliers,” said Mr Quain.

Meanwhile, the IFA has also condemned the Lakelands decision.

IFA National Dairy Committee chairman Sean O’Leary said the Lakeland price was over 1cpl short of the Ornua PPI for October and, in the context of that and the fact that EU average dairy product returns for October would be equivalent to a 30cpl farmgate price, Lakeland suppliers justifiably expected more.

He also said thatco-ops setting the price for October milk this week can, and must, provide considerable increases.

“In the context of significantly improved returns, as well as continued cash flow pressures on farms, and with an eye on setting farmers up for viable price levels for next spring, significant increases for October milk are totally justified.

“I strongly urge co-op boards to deliver the necessary price increase to their fellow dairy farmers,” Mr O'Leary said.