Rise in local milk price justified and needed – UFU

Speaking ahead of next week’s United Dairy Farmers’ Auction, Ulster Farmers’ Union Dairy Chairman Andrew Addison has stressed that local dairy farmers need to receive a fair milk price which truly reflects market conditions.  He said high costs of production remain a serious challenge for milk producers.

Mr. Addison said; “Last month’s auction left milk producers angry and frustrated with the 1.16 pence per litre fall in price.  We expected prices at that auction to remain stable if not improve but instead, the auction delivered a return of 28.19 pence per litre which was totally unexpected and unjustified.  Dairy producers are doing everything they can to be as efficient as possible but with on-farm pressures such as the shortage of silage and the bad weather disrupting slurry spreading, it is vital that next week’s auction returns a strong price.”  

Analysing market conditions in advance of next week’s auction, Andrew commented; “All the indicators point to commodity markets not just firming-up, but rising as sterling continues to weaken.  The average New Zealand Fonterra price rose 2.4% last week, with Whole Milk Powder up by 5.4%.  Added to this, cheddar cheese/whey powder returned close to 41 cents per litre, (equivalent to 31 pence per litre) all of which indicates the auction should be returning an improved price.  On the supply side, global stocks have eased back into balance with demand.  Closer to home, volumes remain low, with the weather and high feed costs continuing to impact upon supplies.  The likelihood is that supplies will remain constrained with on-farm margins under severe pressure. Therefore, we are urging buyers in the market to pay a fair and reflective price for the milk.”