The Ulster Farmers Union (UFU) has said that dairy processors “need to be transparent” about the calculation of milk prices, in the run up to seasonal bonuses.
The farm lobby group’s Dairy Committee chairman, William Irvine, said that the bonus payments cannot be used to “mask” a change to the base milk price, with the UFU claiming that such a move couldn’t be justified.
Despite the negative sentiments which have affected the markets since September, and the weakening cream prices, the UFU insists that there is no case for a change to the base price.
Irvine said that on the basis of winter demand, “processors should give farmers the benefit of the doubt, by leaving prices the way they are.
Dairy fat prices are still ahead of their 12-month average and there has been limited activity on markets. Christmas demand could change that and the falls now are likely to be temporary.
“Above all they must be transparent about how prices and seasonal bonuses are calculated,” he added.
September milk price
In recent weeks, two of Northern Ireland’s largest processors reported major increases in production.
Lakeland Dairies was up 12%, while Dale Farm saw an 8.4% jump during September – with an extra 4.6 million litres of milk produced in total during the month of August.
At that time, Dale Farm was holding at 28.2p/L, the highest price on the island of Ireland. Lakeland Dairies was running slightly lower at 27.5p/L.
Last week, Dale Farm announced their second fixed-price contract, offering its 1,300 suppliers a base price of 28p/L for a fixed amount of milk.
