Milk Price- Please read Mod note in post #1

keep going · 18-11-2015 12:04AM

alps wrote: »

This is the Carbery one. Correct me of I'm wrong but is this their first one?
Would someone go into this so as to get priority to get onto the next one?
Remember Carbery are on or near 28c as it is.....and a limit of 5% of your supply...?j

Just shocked....

a couple of answers
no its not the first scheme,there was one available in march at 32.5 which was poorly subscribed to
almost certain there is no priority to another scheme or to previous schemes.
as far as im aware its 5 % of the total milk pool this time whereas last time it was 20% of your quota so my hunch is less than half the suppliers will take it up.that is why my advice to all west cork suppliers is not to take it up;)
somebody was trying to convince me that it was a sure sign milk price was going to go up and they want lock in cheap milk before it does,needless to say i agreed with him

darragh_haven · 18-11-2015 12:10AM

keep going wrote: »

a couple of answers
no its not the first scheme,there was one available in march at 32.5 which was poorly subscribed to
almost certain there is no priority to another scheme or to previous schemes.
as far as im aware its 5 % of the total milk pool this time whereas last time it was 20% of your quota so my hunch is less than half the suppliers will take it up.that is why my advice to all west cork suppliers is not to take it up;)
somebody was trying to convince me that it was a sure sign milk price was going to go up and they want lock in cheap milk before it does,needless to say i agreed with him

You are a crafty haure.

keep going · 18-11-2015 12:13AM

darragh_haven wrote: »

You are a crafty haure.

only learning off you boys,only learning off you boys:P.doing a few sums at the minute and and reckon the fonterra forecastfor this season is equating to around 19 cent a litre give or take.

kowtow · 18-11-2015 12:20AM

"32c"

Who is buying?

jaymla627 · 18-11-2015 12:32AM

keep going wrote: »

a couple of answers
no its not the first scheme,there was one available in march at 32.5 which was poorly subscribed to
almost certain there is no priority to another scheme or to previous schemes.
as far as im aware its 5 % of the total milk pool this time whereas last time it was 20% of your quota so my hunch is less than half the suppliers will take it up.that is why my advice to all west cork suppliers is not to take it up;)
somebody was trying to convince me that it was a sure sign milk price was going to go up and they want lock in cheap milk before it does,needless to say i agreed with him

Our maybe they're trying to do ye a favour, you really shouldn't be looking at this scheme like some big bad wolf dairy markets are in the s##t, and your turning your nose up at a fixed price scheme that glanbia suppliers would kill to have.....
A really good case study would be where fonterra where offering a fixed milk price of 7 dollars kilo of milk solids on up to half your supply for the season after the record 8 dollar plus was achieved, of course lads thought it was a scam and the scheme was under subscribed we all know the rest of the story with the payout being 4 dollars, the processor dosent always win in these schemes

whelan2 · 18-11-2015 06:43AM

milk statements are up now. I got 35.36 cpl

Milked out · 18-11-2015 07:50AM

whelan2 wrote: »

milk statements are up now. I got 35.36 cpl

Good going whelan. Is that including winter bonus or liquid price?

whelan2 · 18-11-2015 08:31AM

Milked out wrote: »

Good going whelan. Is that including winter bonus or liquid price?

yes have a big enough liquid milk quota and solid were good enough

Timmaay · 18-11-2015 09:09AM

Similar here. With very few autumn calvers here, and cows out full time on what was an excellent October for grazing it's one milk cheque which will actually leave a decent bit of profit!

kowtow · 18-11-2015 09:27AM

Everyone's circumstances are different and it would be better if the schemes were transparent, but by and large I'm surprised at how high the fixed prices are.

WheatenBriar · 18-11-2015 10:01AM

Timmaay wrote: »

Similar here. With very few autumn calvers here, and cows out full time on what was an excellent October for grazing it's one milk cheque which will actually leave a decent bit of profit!

Aye,mine too was almost exactly the same as whelan2's

Its your turn to drive next month when we are breaking into Ballyragget to hack their computers

Greengrass1 · 18-11-2015 10:21AM

39.15 here.
5.13 bf
4.07 p

Be a while again before we see 55c for winter milk

WheatenBriar · 18-11-2015 10:30AM

Greengrass1 wrote: »

39.15 here.
5.13 bf
4.07 p

Be a while again before we see 55c for winter milk

Aye,but 50c is a fair price
32 or 36 doesn't leave a fair wage
I'm preaching to the converted here though and such is the nature of the game we're in,we need to budget and average our spending to reflect 1 in 3 years having lowish prices/bad weather or both
Trouble is its currently one in two (3 of the last 6 years) which if it isn't already will soon start hole- ing the most efficient of ships
Not helped,to say the least by the arrogant pricing strategy of Giil

Milked out · 18-11-2015 10:37AM

Dairygold well back on winter milk aa well by the looks of things

mahoney_j · 18-11-2015 10:44AM

kowtow wrote: »

Everyone's circumstances are different and it would be better if the schemes were transparent, but by and large I'm surprised at how high the fixed prices are.

+1 it would make u believe that when milk prices start to rise again that they will go up pretty quick

kowtow · 18-11-2015 10:59AM

mahoney_j wrote: »

+1 it would make u believe that when milk prices start to rise again that they will go up pretty quick

Not sure I'd take that message from it. It might be that if milk prices ever go past 32c in the medium term, they go up quickly, but whoever might be buying these fixed price volumes really does have no more idea than you or I what the market is going to do.

I can think of airlines that went bust over 500 million dollars or so of oil hedged out by buying fixed price forward fuel with oil at 120+ / bbl -

But the balance of probabilities here is that someone is going to lose out on a fixed price purchase. The possible losers are (1) the buyer, who will be paying a fixed price greater than the market, (2) The other producers selling to the same co-op who will somehow end up penalised as and when the co-op finds a way to compensate the poor old buyer with some especially cheap milk, (3) if there is no buyer, the other producers for the co-op who will have to make up the loss on the fixed price contract and finally (4) the producer who signs up to the fixed price and loses some future margin which may or may not be there.

Of those potential losers, I'd rather be at risk of falling into category (4) than an unwilling member of category (2) or (3), and on that basis it strikes me as the sensible card to play regardless.

However - everyone is different, it's not a deal to take if you feel you would be aggrieved by losing out on future higher prices if and when they come. Also better to take it on only a chunk of milk where possible. Hedge the Hedge.

WheatenBriar · 18-11-2015 11:24AM

Aye, you can be pretty sure Giil has its sums well done on the 32c fixed price thing,a buyer is there at small volumes
It makes great press,certain in the knowledge that farmers representatives aren't as good in the media as the sure in their big salaries glanbia boffins

In my experience,going back nearly 40 years most of the so called ag and ag industry 'experts' couldn't predict ice in a frost to be honest

keep going · 18-11-2015 11:34AM

WheatenBriar wrote: »

Aye, you can be pretty sure Giil has its sums well done on the 32c fixed price thing,a buyer is there at small volumes
It makes great press,certain in the knowledge that farmers representatives aren't as good in the media as the sure in their big salaries glanbia boffins

In my experience,going back nearly 40 years most of the so called ag and ag industry 'experts' couldn't predict ice in a frost to be honest

just for the fun of it whats yer stab at predicting milk price,mine is sub 30 for the whole of next year with a rise in 20 17,if it comes early 2017 prices could hit 33 to 35 if it comes late 2017 we will serious money in 2018.i expect milk production to drive on in 2016 in eu and usa but the bell to finally toll in 20 17 and probally see a general commodity rise in 2017.all predicitions subject to war:eek:

kowtow · 18-11-2015 11:45AM

WheatenBriar wrote: »

Aye, you can be pretty sure Giil has its sums well done on the 32c fixed price thing,a buyer is there at small volumes
It makes great press,certain in the knowledge that farmers representatives aren't as good in the media as the sure in their big salaries glanbia boffins

In my experience,going back nearly 40 years most of the so called ag and ag industry 'experts' couldn't predict ice in a frost to be honest

Reading the IDB presentation the other day I got the impression that they were "handing around" a limited number of fixed price contracts to various co-ops. What I don't get is whether those arise from their own manufacture or an external buyer.

I'm not quite sure of the structure here so could be wrong but it is possible I suppose that some of the margin in these fixed price deals is - in fact - simply the manufacturing premium by another name.

For example, consider that I milk cows and make cheese. Depending on how I allocate my margins I could pay myself anything between 23c / litre (the global market price) and 55c / litre for my milk (because my milk and the mode of it's production is an essential part of the cheese story), both of which extremes are perfectly justifiable from an accounting perspective.

Under those circumstances it would hardly bother me to label a proportion of my milk as "35c" or "40c" for the next two years - I'd make slightly less profit on the cheese, but that would all come out in the wash as I'd be making it on the milk in the short term.

That's a very different situation to having a genuine unconnected commodity buyer in the wings looking to fix commodity milk as a hedge against a future price rise - which is what we all hope exists in the case of these fixed price offerings. In that case, his future loss is our future gain (and vice versa), quite unlike the manufacturing example.

That's where the lack of transparency makes things difficult.

frazzledhome · 18-11-2015 12:33PM

Greengrass1 wrote: »

39.15 here.
5.13 bf
4.07 p

Be a while again before we see 55c for winter milk

Add your reply here.
38.87 F 4.71 P 4.03
38.97 F 4.73 P 4.04

That's inc Winter, lactose bonus, 1c fro Coop and vat
Excluding winter bonus it would've been 30.87 so that's 6.87 in solids above base.

Deepsouthwest · 18-11-2015 12:35PM

keep going wrote: »

a couple of answers
no its not the first scheme,there was one available in march at 32.5 which was poorly subscribed to
almost certain there is no priority to another scheme or to previous schemes.
as far as im aware its 5 % of the total milk pool this time whereas last time it was 20% of your quota so my hunch is less than half the suppliers will take it up.that is why my advice to all west cork suppliers is not to take it up;)
somebody was trying to convince me that it was a sure sign milk price was going to go up and they want lock in cheap milk before it does,needless to say i agreed with him

Can't figure out the neagativity around the fixed price scheme. I signed up for 20% of my milk, wish I could've included more, at the 32.5c/l, which with my solids averaged over 36c/l, that's has been a nice boost right through this yr for me. From what I can gather, only 40 out of 640 suppliers signed up to this.
Farmers can be a suspicious crowd!

frazzledhome · 18-11-2015 01:12PM

Dsw is bang on. We always feel there's an ulterior motive when these are offered. In GII anyone and it's no one has all there milk in and rightly so. The guys with 30% fixed from the start i.e. Took some in every scheme are rock stars today.

You need to take a balanced approach to it and have a portion fixed. You may lose in the high times but you'll gain during leaner times when you really need it.

To answer Kiwtows question it is a fixed amount to one customer for a fixed period. The GII scheme is linked to Ag inflation so you're basically securing a margin for that period. Now who wouldn't like that?

kowtow · 18-11-2015 01:19PM

frazzledhome wrote: »

To answer Kiwtows question it is a fixed amount to one customer for a fixed period. The GII scheme is linked to Ag inflation so you're basically securing a margin for that period. Now who wouldn't like that?

Is the customer wholly disconnected from GIIL and it's associated entities?

Dawggone · 18-11-2015 01:19PM

[quote="Deepsouthwest;97776202"
Farmers can be a suspicious crowd![/quote]

+1.
Risk management.
When locking into a price, I usually buy a chunk of fert or chems etc.

frazzledhome · 18-11-2015 01:21PM

kowtow wrote: »

frazzledhome wrote: »

To answer Kiwtows question it is a fixed amount to one customer for a fixed period. The GII scheme is linked to Ag inflation so you're basically securing a margin for that period. Now who wouldn't like that?

Is the customer wholly disconnected from GIIL and it's associated entities?

Add your reply here.
To date yes, latest I can't tell you

frazzledhome · 18-11-2015 01:24PM

Dawggone wrote: »

[quote="Deepsouthwest;97776202"
Farmers can be a suspicious crowd!

+1.
Risk management.
When locking into a price, I usually buy a chunk of fert or chems etc.[/quote]
Add your reply here.
That's interesting, with the latest offer from GII there's a mechanism to fix feed costs.

Dawggone · 18-11-2015 01:27PM

frazzledhome wrote: »

Add your reply here.
That's interesting, with the latest offer from GII there's a mechanism to fix feed costs.

Hedge the hedge.

kowtow · 18-11-2015 01:29PM

frazzledhome wrote: »

Add your reply here.
That's interesting, with the latest offer from GII there's a mechanism to fix feed costs.

Won't be long before we can lock into enough financial contracts to replicate the full "synthetic milking" experience.

That'll be a great relief. Up until now I've had to stand in a cold shower burning 20 euro notes and getting one of the children to pour slurry over my head and stamp on my fingers.

Dawggone · 18-11-2015 01:30PM

kowtow wrote: »

Won't be long before we can lock into enough financial contracts to replicate the full "synthetic milking" experience.

That'll be a great relief. Up until now I've had to stand in a cold shower burning 20 euro notes and getting one of the children to pour slurry over my head and stamp on my fingers.

LMAO!!

Deepsouthwest · 18-11-2015 01:33PM

frazzledhome wrote: »

Add your reply here.
That's interesting, with the latest offer from GII there's a mechanism to fix feed costs.

That makes a lot of business sense.
But unfortunately most farmers want it all, all the time!

Milk Price- Please read Mod note in post #1

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