Milk Price- Please read Mod note in post #1

Deepsouthwest

Panch18 wrote: »

Ah Katie melua I believe

A rather attractive young woman if I remember correctly

Indeed! But didn't she say nine million bicycles!

Panch18

You know a lot of people are on here complaining about coops and supermarkets and unfair practices from them and rightly so

youve got kowtow banging on about free markets and letting them run their course to sort it out. And that's great n theory and something that I would agree with in principle

However kowtow fails to highlight why the market is fundamentally flawed and that is due to the parasite that is speculation. You can become a multi multi millionaire by sitting in front of a computer screen in the heart of London buying and selling milk powder or corn or whatever without ever seeing a field or a cow in your life. Speculation leads to a completely distorted markets which has huge peaks and troughs. I read somewhere before that your typical ton of corn is traded 7 times between the company and the end user. That is all wrong

There is no way that milk production has increased so much in the last 12 months that it is lead to the price falling by what 40%.

The easiest way to think about this is your local mart, which is as good as a free market as you are going to find anywhere in the world. You have farmers buying and selling, all good. But then you have dealers buying and selling and distorting the market by bidding on their own cattle, stopping farmers buying etc etc. they are the leeches of the mart, and in exactly the same way commodity speculators are the leeches of our milk, grain and beef markets. And in fact the speculators are worse than the cattle dealers as at least the dealers usually take ownership of the cattle and look after them for some period of time anyway

kowtow

Deepsouthwest wrote:

Indeed! But didn't she say nine million bicycles!

So she did


I take it all back. Bicycle growth and population growth are running in tandem.

kowtow

Panch18 wrote:

The 100 cow farm in Ireland will be fine for the next 20 years at least in this country as long as they can control costs and debt levels. Do that and they'll be fine.

Panch18 wrote:

Much more likely to last in fact than some of the bigger operations

I think you are absolutely right on that point. As long as farmers are happy to work for nothing for chunks of the price cycle and as long as new bigger merged co-ops don't find ways to discriminate against them the smaller farm is very hard to dislodge.

But survival is not prosperity and eventually fixed costs must be faced .. new capex will be needed as the generations go on.

That's where we are going to need higher value products.

yosemitesam1

Panch18 wrote: »

You know a lot of people are on here complaining about coops and supermarkets and unfair practices from them and rightly so

youve got kowtow banging on about free markets and letting them run their course to sort it out. And that's great n theory and something that I would agree with in principle

However kowtow fails to highlight why the market is fundamentally flawed and that is due to the parasite that is speculation. You can become a multi multi millionaire by sitting in front of a computer screen in the heart of London buying and selling milk powder or corn or whatever without ever seeing a field or a cow in your life. Speculation leads to a completely distorted markets which has huge peaks and troughs. I read somewhere before that your typical ton of corn is traded 7 times between the company and the end user. That is all wrong

There is no way that milk production has increased so much in the last 12 months that it is lead to the price falling by what 40%.

The easiest way to think about this is your local mart, which is as good as a free market as you are going to find anywhere in the world. You have farmers buying and selling, all good. But then you have dealers buying and selling and distorting the market by bidding on their own cattle, stopping farmers buying etc etc. they are the leeches of the mart, and in exactly the same way commodity speculators are the leeches of our milk, grain and beef markets. And in fact the speculators are worse than the cattle dealers as at least the dealers usually take ownership of the cattle and look after them for some period of time anyway

Speculation is important to have in the markets, if you look at Russia and the Midwest in USA before the grain was traded in exchanges they were an awful lot worse off than today, you could bring your years work to sell and find it was worthless.

keep going

A bit of simple maths, average milk price last seven years 31 cent, high last year 39 =low 23

Buford T. Justice XIX

kowtow wrote: »

I think you are absolutely right on that point. As long as farmers are happy to work for nothing for chunks of the price cycle and as long as new bigger merged co-ops don't find ways to discriminate against them the smaller farm is very hard to dislodge.

But survival is not prosperity and eventually fixed costs must be faced .. new capex will be needed as the generations go on.

That's where we are going to need higher value products.

That's the crunch point. You can survive on a low milk price for years but eventually market requirements will change and money will have to be spent.

The FWMS arrived at just the right time for a lot of farmers and kept them in the game for another few years.

If there isn't investment practically every year then it's just making the eventual spend that much harder to afford.

blue5000

Any new entrants on here, how are they coping with the price drop etc.?

WheatenBriar

Whatever about new entrants, I don't see myself continuing beyond 55 or 60 tbh and I certainly would not encourage my siblings to take over,you'd want to be stone mad
I love the work but the return and the sheer lack of respect for one of the most important jobs in the world does not justify doing it

We are most of the time,no matter how effecient, a food charity,lets call a spade a spade and be blunt about it

The bord bia audit is the latest codology
I'd like to think most of us take enough pride in our place and stock to keep it nice but a lot of us are having to spend(admittedly mostly small amounts) to pass that yoke for no return
Meanwhile farmers in the UK are paid more without it..

jaymla627

WheatenBriar wrote: »

Whatever about new entrants, I don't see myself continuing beyond 55 or 60 tbh and I certainly would not encourage my siblings to take over,you'd want to be stone mad
I love the work but the return and the sheer lack of respect for one of the most important jobs in the world does not justify doing it

We are most of the time,no matter how effecient, a food charity,lets call a spade a spade and be blunt about it

The bord bia audit is the latest codology
I'd like to think most of us take enough pride in our place and stock to keep it nice but a lot of us are having to spend(admittedly mostly small amounts) to pass that yoke for no return
Meanwhile farmers in the UK are paid more without it..

They actually get 1.5 cent top up if part of red tractor scheme which is basically the bord bia equivalent, another issue that glanbia don't entertain is bonuses for milk quality re scc/tbc etc, the fact a guy that hovers around 300,000 scc for the year gets the same price as sub 100,000 guys is a joke

kowtow

In answer to panch's point above about speculation. .. clearly I am biased but it's worth remembering that it is a question of degree.

Every time we put a seed in the ground, lift grass, or put ration in front of a cow we are speculating. Most definitely everyone of us that milks a herd for little or nothing or even less is making an informed bet - that now is not the time to quit, that prices will recover, that our sons will benefit from our risk today..

The futures markets were created by farmers and they've served farmers well for centuries. It's notable that milk, with all its painful volatility is the one global commodity which doesn't have a market .. or at least a market with speculation.

Panch18

Deepsouthwest wrote: »

Indeed! But didn't she say nine million bicycles!

Oops!!!

atlantic mist

do we sell our product in futures markets?
most coops have specific buyers dont they and if not what are the sales departments doing?
was that not the reason for formation of IDB?
never seen any of our coops taking part in global trade auctions
what always confuses me is our coops use the gdt as our base but dont use the platform

kowtow

atlantic mist wrote:

do we sell our product in futures markets? most coops have specific buyers dont they and if not what are the sales departments doing? was that not the reason for formation of IDB? never seen any of our coops taking part in global trade auctions what always confuses me is our coops use the gdt as our base but dont use the platform

I suspect it's not so much our co-ops as their customers who use the gdt Base price!

WheatenBriar

I had a few beers at a bar once with a Canadian man in his 70s whose daughter he was over visiting
He was still a working investment broker and enjoying life

He said in every business theres a fcuker and a fcukee
So he asked me who's the fcuker and who's the fcukee in the milk business?
Despite being drunk,I didn't have to think about the answer...

kevthegaff

kowtow wrote: »

I suspect it's not so much our co-ops as their customers who use the gdt Base price!

independent sellers also buying from co op and selling on

Greengrass1

I

red bull

Greengrass1 wrote: »

I

Something wrong in that graph, English milk price not ahead of Ireland in 2015

Greengrass1

red bull wrote: »

Something wrong in that graph, English milk price not ahead of Ireland in 2015

That's solids. Anyone on a solid contract I've been talking to in UK is fine the ones on solids con tracts are getting 31cpl base price

Milked out

Another spin out for ye glanbia lads

mahoney_j

Milked out wrote: »

Another spin out for ye glanbia lads

Still paying a ****e price though!!

Milked out

mahoney_j wrote: »

Still paying a ****e price though!!

Better than ours and we get no spinout!

Greengrass1

Milked out wrote: »

Another spin out for ye glanbia lads

It'll pay for the milk tank I suppose :O

Sacrolyte

"And didst thou not kiss me and bid me fetch thee thirty shillings".

darragh_haven

Greengrass1 wrote: »

It'll pay for the milk tank I suppose :O

No pity for ye. Shur ye are raking it in

frazzledhome

mahoney_j wrote: »

Still paying a ****e price though!!

Lol

At least they pay a good price when price is good, unlike some you know

whelan2

frazzledhome wrote: »

Lol

At least they pay a good price when price is good, unlike some you know

still could have gone over the 40cpl last year though

mahoney_j

frazzledhome wrote: »

Lol

At least they pay a good price when price is good, unlike some you know

Market was returning 42/43 cent for a few months during peak,no one had the balls to go over 40 and money was held and is now been used to support price through market trough .all coops did same now I ask the question how is the biggest player in the country paying 25 cent per litre and the west cork boys paying 29 with rest 26.5/27
Plus ????.question needs to be asked.the crowd I know paid a great price over last year ,.the leading price actually I think but we had a conticious Coll charge of 0.6 cent per litre deducted which dragged our net price back .this is now gone and we are getting a 0.2 cent top up for sub 200 k scc milk also along with some other things thrown in to stop any more of us jumping ship !!.yes I'd love a fixed price scheme but I wouldn't like to have to shell out 10 k for shares to qualify for top ups .i thought about going but the share up was going to be too penal for me now considering my stage of development and without top ups it was a no brainier to stay put ,also the plc element and having shareholders to keep happy firstly was a concern

orm0nd

mahoney_j wrote: »

Market was returning 42/43 cent for a few months during peak,no one had the balls to go over 40 and money was held and is now been used to support price through market trough .all coops did same now I ask the question how is the biggest player in the country paying 25 cent per litre and the west cork boys paying 29 with rest 26.5/27
Plus ????.question needs to be asked.the crowd I know paid a great price over last year ,.the leading price actually I think but we had a conticious Coll charge of 0.6 cent per litre deducted which dragged our net price back .this is now gone and we are getting a 0.2 cent top up for sub 200 k scc milk also along with some other things thrown in to stop any more of us jumping ship !!.yes I'd love a fixed price scheme but I wouldn't like to have to shell out 10 k for shares to qualify for top ups .i thought about going but the share up was going to be too penal for me now considering my stage of development and without top ups it was a no brainier to stay put ,also the plc element and having shareholders to keep happy firstly was a concern

aghhh !!, we'll be grand when we get the gas connected, hearing enough about it for the last 12 months, & oil price dropping all the time !

mahoney_j

orm0nd wrote: »

aghhh !!, we'll be grand when we get the gas connected, hearing enough about it for the last 12 months, & oil price dropping all the time !

Gas price savings currently propping up price I'm told.......