Northern Ireland dairy cooperative Dale Farm is offering its 1,300 farmers the opportunity to enter a three-year fixed milk price supply contract commencing in January 2019.
It’s the second time the dairy cooperative has provided such an option to farmers. It follows the processor’s first fixed price contract that commenced in January 2018.
Dale Farm’s farmer producers can agree to supply an agreed amount of milk per month at a base price of 28p/L for the duration of the contract.
The previous three-year contract tied suppliers in at 27p/L.
Milk supplied on the contract will be eligible for standard quality payments of Dale Farm Cooperative, as well as the large producer rebate bonus.
Producers can offer either 5%, 10%, or 15% of their supply for each of the 12 months from October 2017 to September 2018 for inclusion as the monthly agreed volume in the fixed price contract.
Each participant will enter a binding contract to supply the agreed amount of milk for each of the 36 months of the contract, from January 1, 2019, until December 31, 2021.
Stephen Cameron, group commercial director at Dale Farm said: “Our business is centred around supporting our farmers and following an extremely positive response to our first voluntary fixed milk price contract, we are pleased to extend this option for 2019.
Each farmer will consider their own unique circumstances carefully and decide if a fixed milk price contract for part of their milk supply is attractive.
“This contract provides farmers with a tool to manage their businesses through removing the milk price uncertainty that is being driven by the volatility in world dairy market returns.”
Dale Farm’s Fixed Price Contract will be discussed in detail with farmer members at the cooperative’s upcoming Annual General Meeting and applications will be accepted until Friday, November 9, 2018.
