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Milk Price- Please read Mod note in post #1

delaval

24/6/16

Recently we saw three posters close their accounts over disagreements in the dairy threads. While there is a lot of frustration and discontent with current milk prices and the processing industry, the recent tendency for dairy threads to become tit-for-tat arguments isn’t tolerable for those not involved.

All farming sectors go through difficult periods and during such times there may need to be changes in how threads are moderated.

Dairy threads are going to be more closely monitored and subject to stricter moderation for a while.

To that end we won’t tolerate baiting of posters, constantly reviving old arguments, posters with agendas or crusading for a cause.

Whether it’s discussion of the business or politics of the dairy or other sectors, we expect civility and tolerance toward each other and other opinions as diversity of opinion is needed as a source of different ways of looking at a situation.

"The aim of argument, or of discussion, should not be victory, but progress." - Joseph Joubert

Also please be aware that what you may post as light-hearted banter can be read totally differently by someone adversely affected by the subject matter and evoke a reaction you hadn’t intended.

The ‘Off-Season’ forum, and its anonymous posting, is available for anyone to chat about their situation.

The Mod Team.

I was wondering would it be a help if we posted our milk prices. I would hope that if someone is low that help could be given, on the other hand if high perhaps your tips could help us all.

I would suggest posting your processors base inc Vat for comparison
Post your Nett price for others to help or be helped
I think that solids should be included.
I suggest any seasonal/liquid contract price be excluded or seperated.

I feel that we as farmers do a lot of bitching about processor prices and rightly so IMO. I also feel that we should not worry about it as we can do nothing about base price but we certainly do something about it at farm level.

What do you all think?

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frazzledhome

Blackgrass wrote: »

El Niño was highlighted 2+ months ago and they reckon this could be extremely severe and usually coincides with strengthening grain price

Barley needs to be trading at close to €200/ tonne to maintain milk price

Blackgrass

frazzledhome wrote: »

Barley needs to be trading at close to €200/ tonne to maintain milk price

,in Ireland.

whelan2

frazzledhome wrote: »

Barley needs to be trading at close to €200/ tonne to maintain milk price

what is it at the moment?

WheatenBriar

whelan2 wrote: »

what is it at the moment?

Closer to 100 than 200 I'd say

Greengrass1

WheatenBriar wrote: »

Closer to 100 than 200 I'd say

140 I think for feed.
170 for malting

kowtow

yosemitesam1 wrote: »

So would you need maybe five or six different powder contracts (whey,smp etc) and the co-op to guarantee some sort of a formula based minimum price? What sort of volumes would a contract need to be liquid enough?

The contract in this sense is just the specification and size of a "lot" - the minimum unit that can be bought or sold in a futures market.

The US milk futures contract is over about 90,000 litres (200K lbs I think).. all contracts are sized for the amount of product that will fit in a railway car - 5000 bushels for wheat, for example. Oddly on the floor of the exchange all contracts are referred to as "cars" - even the financial ones - although who decided how many T-bill futures would fit in a railway car is a complete mystery.

As far as a futures market is concerned the co-op wouldn't necessarily come into it - and yes, you would need a standard contract specification to cover a particular grade / makeup of milk powder which was capable of delivery. I suspect that the GDT has this addressed in one form or another as well.

trixi2011

Got word this week that milk company are holding the price at 21.8 p for sep and dropping down to 21 in Oct lads that are protesting over here must be making some bit of an impact

Dawggone

kowtow wrote: »

Oddly on the floor of the exchange all contracts are referred to as "cars" - even the financial ones - although who decided how many T-bill futures would fit in a railway car is a complete mystery.

Thanks Kowtow, I could never understand the "car" terminology.

Dawggone

trixi2011 wrote: »

Got word this week that milk company are holding the price at 21.8 p for sep and dropping down to 21 in Oct lads that are protesting over here must be making some bit of an impact

"The squeaky wheel always gets the fat (grease)"...

Milked out

trixi2011 wrote: »

Got word this week that milk company are holding the price at 21.8 p for sep and dropping down to 21 in Oct lads that are protesting over here must be making some bit of an impact

The thing I saw in YouTube where farmers were in a supermarket asking consumers to pay more is the wrong way I reckon, it's the margin the supermarkets are taking is the problem. Is it Morrisons putting out a new branded milk with 10p extra towards the farmer? If that's more expensive than the stuff in the fridge next to it and consumers dont buy it the supermarket have their excuse done for em. Could have details wrong there but seems like it would backfire on the farmers.

kowtow

Dawggone wrote: »

Thanks Kowtow, I could never understand the "car" terminology.

funny isn't it, I could always follow floor audio with thick Chicago accents at warp speed while watching five screens full of prices and rarely miss a tick... but when I go to the local mart I sit beside the ring like a mesmerised puppy, totally unable to follow the action.

Takes practice.

Dawggone

kowtow wrote: »

funny isn't it, I could always follow floor audio with thick Chicago accents at warp speed while watching five screens full of prices and rarely miss a tick... but when I go to the local mart I sit beside the ring like a mesmerised puppy, totally unable to follow the action.

Takes practice.

Lol. That's it. Practice.

trixi2011

Milked out wrote: »

The thing I saw in YouTube where farmers were in a supermarket asking consumers to pay more is the wrong way I reckon, it's the margin the supermarkets are taking is the problem. Is it Morrisons putting out a new branded milk with 10p extra towards the farmer? If that's more expensive than the stuff in the fridge next to it and consumers dont buy it the supermarket have their excuse done for em. Could have details wrong there but seems like it would backfire on the farmers.

I think them lads protesting are going about it the wrong way there putting so much energy into fighting the milk price when they should be at home figuring out how they could be lowering there costs .

Dawggone

trixi2011 wrote: »

I think them lads protesting are going about it the wrong way there putting so much energy into fighting the milk price when they should be at home figuring out how they could be lowering there costs .

Is it not possible to do both Trixi?

Milked out

trixi2011 wrote: »

I think them lads protesting are going about it the wrong way there putting so much energy into fighting the milk price when they should be at home figuring out how they could be lowering there costs .

Agree with that definately, but if they are to protest they should try to get pressure/ public opinion to bare on supermarkets instead asking consumers to pay more it would be better than what thye are at, particularly for liquid milk as it's a domestic market

Brown Podzol

trixi2011 wrote: »

I think them lads protesting are going about it the wrong way there putting so much energy into fighting the milk price when they should be at home figuring out how they could be lowering there costs .

I agree with them. I hope they tear up the f'n place. If politicians interfere with the price of milk by putting embargoes on Russia and the only people to pay are the primary producers then they must suffer the consequences. I didn't hear of any politician suffering a pay cut since the embargoes.

Buford T. Justice XIX

kowtow wrote: »

funny isn't it, I could always follow floor audio with thick Chicago accents at warp speed while watching five screens full of prices and rarely miss a tick... but when I go to the local mart I sit beside the ring like a mesmerised puppy, totally unable to follow the action.

Takes practice.

https://v.cdn.vine.co/r/videos/DAEF4A6B9D1158884140104732672_27d1302a331.5.1.8797355555200404019.mp4?versionId=c.0WBwpN1jxwVkloZnr9doOr2PVQvTWq

I still can't imbed vines:rolleyes:

kowtow

I think drawing the public's attention to the price of milk compared with cost of production is actually a very good starting point. "Fair Trade" products from coffee onwards have all worked pretty well given sufficient publicity, and attract a premium simply in respect of the relative sustainability of the farm income.

What is more difficult is figuring out the degree to which UK prices (or US prices for that matter) are becoming coupled to the global powder trade. My impression is that liquid milk prices in the UK are dropping because of the global glut into which the *surplus* manufacturing milk has to be sold... but I could be wrong.

In Ireland of course that global glut is our primary target market by volume, so hitting the supermarkets would be a complete sideshow (if it wasnt for the Euro disguising the drop pro tem).

Edit: have a feeling next week's Gdt might be important.

1. NZ farmers showing signs of capitulation after last week. When people suggest cancelling an auction because they don't like the prices then it won't be too long before an extreme is reached.

2. Chinese devaluation ought to be very bearish for Chinese dairy demand. Economy slowing faster and imports now more expensive. Any speculative chinese buyers should now run away fast.

3. Grains fell 5% today

All dreadful signs which suggest that if prices were to stabilise or even rise on decent volume next week we might be seeing the whites of the markets eyes and getting towards the end of a phase.

Of course they might well fall further. Worth watching closely.

Milked out

http://www.agriland.ie/farming-news/fonterra-to-cut-significantly-the-volume-of-product-sold-on-gdt/

Buford T. Justice XIX

Any news on the Lakeland price yet?

kowtow

Milked out wrote: »

http://www.agriland.ie/farming-news/fonterra-to-cut-significantly-the-volume-of-product-sold-on-gdt/

Concealing the price is the last refuge of the damned. It conceals the market clearing price;

They tried this tactic in December / January IIRC and there was a temporary pop in the price until buyers realised they were being gamed. Now they are going to do the same again, messing with the volume (which is why I added the caveat of decent volume in my post above) and what could have been a really informative GDT auction will be meaningless whether it rises or falls.

solwhit12

Buford T. Justice V wrote: »

Any news on the Lakeland price yet?

Down a cent to 27

freedominacup

kowtow wrote: »

I think drawing the public's attention to the price of milk compared with cost of production is actually a very good starting point. "Fair Trade" products from coffee onwards have all worked pretty well given sufficient publicity, and attract a premium simply in respect of the relative sustainability of the farm income.

What is more difficult is figuring out the degree to which UK prices (or US prices for that matter) are becoming coupled to the global powder trade. My impression is that liquid milk prices in the UK are dropping because of the global glut into which the *surplus* manufacturing milk has to be sold... but I could be wrong.

In Ireland of course that global glut is our primary target market by volume, so hitting the supermarkets would be a complete sideshow (if it wasnt for the Euro disguising the drop pro tem).

Edit: have a feeling next week's Gdt might be important.

1. NZ farmers showing signs of capitulation after last week. When people suggest cancelling an auction because they don't like the prices then it won't be too long before an extreme is reached.

2. Chinese devaluation ought to be very bearish for Chinese dairy demand. Economy slowing faster and imports now more expensive. Any speculative chinese buyers should now run away fast.

3. Grains fell 5% today

All dreadful signs which suggest that if prices were to stabilise or even rise on decent volume next week we might be seeing the whites of the markets eyes and getting towards the end of a phase.

Of course they might well fall further. Worth watching closely.

Glanbia shareholders need to organise a whiparound and get kowtow enough shares to make him eligible to stand for a seat on the board and then get him onto it.

Greengrass1

http://www.farmersjournal.ie/glanbia-cuts-base-milk-price-by-1c-l-for-july-187599/
Second last paragraph. Is that saying any suppliers that didn't get bonuses will get everything they would have gotten when they become a member

WheatenBriar

Aldi are committed now along with morrisons in the UK to paying 28 pence which is the equivalent of 36 cent...

Glanbia are a co operative?

Me arse

kowtow

freedominacup wrote: »

Glanbia shareholders need to organise a whiparound and get kowtow enough shares to make him eligible to stand for a seat on the board and then get him onto it.

Don't think they'd like me. I'd be inclined to sell the board room seats and hold meetings standing up in the yard.

Rather than whingeing on about price supports and EU intervention why don't the farmers organisations insist that co-ops publish transparent figures on a quarterly basis - the Glanbia price move today suggests that 25c is the underlying manufacturing price for July. We need to know, precisely, what value the co-ops are receiving for our milk when it goes out the door.

So what is happening to the balance sheets of other co-ops who end up paying 25c or greater for July? Or is GIIL actually receiving less in the marketplace for all the added value? Or is it now the case that Glanbia expect the farmers who *havent* signed an MSA to fund their investment programme by effectively discounting the milk price via a round robin with the loyalty bonus.

Edit: and as for the IFA they have NO business whatsoever advising co-ops to consider mergers. The co-ops & processors are quite greedy enough to think this one through on their own. The IFA is a farmers organisation not a corporate consultancy or an investment adviser. Whether or not a co-op merges is the business of it's shareholders, the fact that they happen to be farmers is a coincidence.

Those who represent farmers should have a cold towel on their heads figuring out the *dangers* to milk producers from bad mergers rather than the supposed advantages and working out how to ensure that every dairy farmer in this country is able to have his milk brought to a competitive marketplace in a completely transparent manner.

kevthegaff

kowtow wrote: »

Don't think they'd like me. I'd be inclined to sell the board room seats and hold meetings standing up in the yard.

Rather than whingeing on about price supports and EU intervention why don't the farmers organisations insist that co-ops publish transparent figures on a quarterly basis - the Glanbia price move today suggests that 25c is the underlying manufacturing price for July. We need to know, precisely, what value the co-ops are receiving for our milk when it goes out the door.

So what is happening to the balance sheets of other co-ops who end up paying 25c or greater for July? Or is GIIL actually receiving less in the marketplace for all the added value? Or is it now the case that Glanbia expect the farmers who *havent* signed an MSA to fund their investment programme by effectively discounting the milk price via a round robin with the loyalty bonus.

Edit: and as for the IFA they have NO business whatsoever advising co-ops to consider mergers. The co-ops & processors are quite greedy enough to think this one through on their own. The IFA is a farmers organisation not a corporate consultancy or an investment adviser. Whether or not a co-op merges is the business of it's shareholders, the fact that they happen to be farmers is a coincidence.

Those who represent farmers should have a cold towel on their heads figuring out the *dangers* to milk producers from bad mergers rather than the supposed advantages and working out how to ensure that every dairy farmer in this country is able to have his milk brought to a competitive marketplace in a completely transparent manner.

I had a few guys persuading me to join glanbia in the beginning of the yesr, all i heard was higher end products, bellview, the future etc. I asked who was paying for belview... i have nothing against glanbia but i agree with kowtow how come with higher end products its not trickling down to the supplier.
1. Shareholders dividents
2. Major Plant
3.dilution of shares
What will the ifa do if there is only 1 co op in the country, say a need for fragmentation! We do need different co ops to set benchmarks for prices however bad they are.

jaymla627

kevthegaff wrote: »

I had a few guys persuading me to join glanbia in the beginning of the yesr, all i heard was higher end products, bellview, the future etc. I asked who was paying for belview... i have nothing against glanbia but i agree with kowtow how come with higher end products its not trickling down to the supplier.
1. Shareholders dividents
2. Major Plant
3.dilution of shares
What will the ifa do if there is only 1 co op in the country, say a need for fragmentation! We do need different co ops to set benchmarks for prices however bad they are.

I have nearly six grand put towards belview at this stage after today's cuts, but I shouldn't be complaining I'm going to get shares in lieu of it, it's like a lad pissing on your cornflakes and telling you its milk

Buford T. Justice XIX

kowtow wrote: »

Don't think they'd like me. I'd be inclined to sell the board room seats and hold meetings standing up in the yard.

Rather than whingeing on about price supports and EU intervention why don't the farmers organisations insist that co-ops publish transparent figures on a quarterly basis - the Glanbia price move today suggests that 25c is the underlying manufacturing price for July. We need to know, precisely, what value the co-ops are receiving for our milk when it goes out the door.

So what is happening to the balance sheets of other co-ops who end up paying 25c or greater for July? Or is GIIL actually receiving less in the marketplace for all the added value? Or is it now the case that Glanbia expect the farmers who *havent* signed an MSA to fund their investment programme by effectively discounting the milk price via a round robin with the loyalty bonus.

Edit: and as for the IFA they have NO business whatsoever advising co-ops to consider mergers. The co-ops & processors are quite greedy enough to think this one through on their own. The IFA is a farmers organisation not a corporate consultancy or an investment adviser. Whether or not a co-op merges is the business of it's shareholders, the fact that they happen to be farmers is a coincidence.

Those who represent farmers should have a cold towel on their heads figuring out the *dangers* to milk producers from bad mergers rather than the supposed advantages and working out how to ensure that every dairy farmer in this country is able to have his milk brought to a competitive marketplace in a completely transparent manner.

The value added dividend in Kerry is paid out by the PLC while the farmers are paid commodity prices for their product from which the value added is derived.

It's no different to Glanbia, just another PLC paying all the dividends of the value added to the owners/shareholders while those they purchase the raw materials from get the lowest possible price they can afford to pay so they can bump up the dividends.

kowtow

It's a bit like the Fonterra announcement that they were holding back volume so they could sell it through their "value added" channels.

If there was demand for it at a higher price, why hadn't they acted before this?

On the other hand how do we know that Glanbia aren't actually the worst offender? The others seem to be paying a loyalty bonus (i.e. supporting the price from retained profits) without being explicit about the extent of it.

Not being subject to this regime myself I have no idea whether or to what extent they come clean about things at the end of the year but it strikes me that things are opaque enough to make things uncomfortable for producers when co-ops keep talking about investment (and presumably paying salaries) while producing farmers face a year with - potentially - no personal drawings at all.

If co-ops need to take the food out of farming families mouths in order to invest for the future, they owe us complete transparency over how our milk is valued throughout the system and what the sales levels are. Only then can members see what is investment, and what is inefficiency or market weakness and make decisions accordingly.