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The board of Holland’s big co-op FrieslandCampina set milk prices this week for April.
Friesland will pay a guaranteed April price of 35c/l for milk at 3.57% protein and 4.42% fat.
When adjusted, this compares to about 34c/l at 3.3% protein and 3.6% fat. Last week Irish co-ops averaged about 30.4 c/l ex-VAT, like for like, at 3.3% protein and 3.6% fat for February milk.
So when we compare the February Irish price with the April Dutch price, the Dutch are about 4c/l ahead of the Irish processors and two months further down the line. The Dutch monthly price is also topped up at year end.
So while the Dutch decided to cut the April price by 1.25c/l on March price due to negative market sentiment, they are still well ahead of Irish prices.
IFA’s dairy chair Tom Phelan has come out suggesting there is no denying the impact of COVID-19 on international economic and trade activities, especially when it comes to Chinese food and dairy imports.
Leverage
However, he said it is also the clear that there has been a determined effort by international traders to use this as leverage to lower dairy prices – and co-ops must resist this. “The fact is that, while this may take a few months, the medium- to long-term demand for dairy imports in China will return when the outbreak comes under control and the supply chain clears up,” he said.
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