Ornua Raises Indicative Irish Milk Price by Two Cents
Ornua, Ireland’s commercial dairy export cooperative, reported that its Purchase Price Index (PPI) increased by 5.4 points in September. The index reached 135.8, compared with 130.4 a month earlier, and the associated indicative milk price rose by two cents per litre.
The PPI measures gross market returns from international sales of butter, cheddar, whole milk powder and specialised protein products. Ornua said the September result reflected firmer dairy commodity returns across international trade. The cooperative also noted that the index does not correspond directly to physical milk production or monthly cooperative payments, because milk collection and offshore product sales occur on different timetables and seasonal volumes vary.
Irish milk intake was already declining as the production season moved beyond its summer peak. Central statistics showed that domestic milk intake at processing plants fell by 79m litres year on year in August, to 865.3m litres. Processors including Tirlán, Dairygold and Carbery were therefore operating with lower daily deliveries and adjusting plant schedules as the season progressed.
Late-lactation milk generally contains higher concentrations of butterfat and crude protein. Processing facilities consequently have to manage separation equipment, butter production, cheese vats, drying towers and cold storage as utilisation changes during the final quarter. Ornua’s portfolio includes Kerrygold butter, while the cooperative also sells products to customers in the United Kingdom, continental Europe and North America.
International market conditions were mixed during the period. Some trading sessions recorded lower benchmarks for cheddar, mozzarella and bulk butter, while demand in continental Europe for packaged premium butter and functional dairy ingredients supported prices. Reduced raw-milk availability in north-western Europe, alongside weather-related disruption and local animal-health problems including bluetongue, also limited exportable dairy surpluses, according to the report.
The higher indicative return came as Irish cooperatives faced increased manufacturing costs, higher interest charges on working-capital facilities and elevated energy costs. In August, average base milk prices were reported at about 38.7 cents per litre. Dairy farmers were also entering a period of slower grass growth, greater use of winter silage and increased purchases of concentrate feed, while operating under tighter European Union rules linked to the nitrates derogation.
