Lakeland cuts milk price for the second month in a row
Farm representative bodies have criticised Lakeland for their latest cut in milk price.
In the Republic of Ireland, Lakeland Dairies has reduced the milk price by 6 cent/litre to 46.85 cent/litre inclusive of VAT, for milk at 3.6% fat and 3.3% protein. The February price includes an Input Support Payment of 1.5 cent/litre, inclusive of VAT, for all suppliers.
After a year of sustained record prices in 2022, this marks the second significant cut in price this year. Last month the co-op announced a 6 cent/litre drop for January price.
While relative to historic prices the level remains high, it’s the lowest price announced by the co-op since February 2022, when it paid 41c/l for January milk.
A statement from the coop said the cut is due to market conditions and an unstable market.
They report “weaker conditions have continued due to higher global milk supplies and fluctuating demand from dairy buyers. “This is against a backdrop of economic uncertainty with ongoing inflationary pressures impacting consumer, trade and manufacturing requirements for dairy products and ingredients. Overall outcomes remain unpredictable and there is continuing variability which will remain a feature of global markets for the immediate period ahead.”
They also said they will seek constantly to maximise returns for milk suppliers and will pay as competitive a milk price as possible in line with market conditions.
Cavan IFA dairy chairman Raymond Brady called for co-ops to reduce the price of inputs to match the price cuts.
“If co-ops are taking on one hand they must give with the other,” he told the Celt speaking after Lakeland’s announcement.
“Feed and fertiliser prices have been exceptionally high for the last few years. Co-ops were very quick to increase their prices when milk prices increased so they must respond in kind now that they have dropped.”
ICMSA president Pat McCormack meanwhile branded the cuts in milk price since the start of the year as “absolutely horrendous”. For a farmer producing 400,000 litres, the drop in revenue for 2023 will be of the order of €48,000.
Mr McCormack claimed such an “income hammer blow” is unsustainable, and he urged co-op boards to “steady the ship” on milk price.