Irish milk processor increases farmer payments while offering feed discounts to support suppliers during prolonged dry weather.
Kinisla has announced an increase in the milk price payable to farmers who supplied milk in July, offering some relief to dairy producers facing challenging weather conditions and uncertainty over market demand.
The processor has raised its milk price by 1.1 cent per litre (c/l), including VAT and quality and sustainability bonuses, to 39.1 c/l. The payment is based on standard Irish milk constituents of 3.3% protein and 3.6% butterfat.
July Milk Price at a Glance
|
Payment basis |
Milk price |
|---|---|
|
Standard Irish constituents |
39.1 c/l |
|
Standard EU constituents |
42.82 c/l |
|
Kinisla’s average July milk solids |
42.25 c/l |
|
Increase from previous price |
1.1 c/l |
The processor stated that the price equates to 42.82 c/l including VAT when calculated using standard EU constituents of 3.4% protein and 4.2% butterfat. Based on Kinisla’s average milk solids for July, the milk price, including VAT and bonuses, is 42.25 c/l.
The distinction between the standard Irish and EU constituent calculations reflects differences in the protein and butterfat levels used to assess milk value. For farmers, actual payments depend on the composition of the milk supplied, alongside applicable bonuses and contractual arrangements.
Market Outlook Depends on Supply and Demand
In its milk statement, Kinisla indicated that dairy prices could receive stronger support if milk supply across Europe continues to decline during the second half of the year.
The processor said reduced product availability could help underpin prices, particularly if demand improves from current levels. This outlook highlights the importance of the balance between milk production and market consumption in determining dairy commodity prices.
For milk suppliers, the potential for tighter European supply offers a positive market signal. However, the statement also indicates that improved demand will be important for any sustained strengthening in dairy prices.
Feed Support for Farmers Facing Dry Weather
Alongside the milk price announcement, Kinisla has increased the discount available on selected dairy feeds to €50 per tonne.
The offer runs from Friday, 14 August, to Saturday, 5 September, and is intended to help milk suppliers manage the impact of prolonged dry weather and drought.
Extended dry conditions can place pressure on dairy farms by affecting grass growth and increasing the need for supplementary feed. The additional discount therefore provides a practical form of support for farmers managing feed requirements during a difficult weather period.
Top-Up Payment Included in August Milk Payment
Kinisla also confirmed that suppliers will receive a top-up payment for milk supplied between 1 January and 30 April under their milk supply contract.
The payment will be included with the August milk payment. This provides an additional financial benefit to eligible suppliers and forms part of the processor’s wider support for its milk supply base.
Taken together, the July price increase, feed discount and contractual top-up payment provide several forms of support for Kinisla suppliers. The measures come as dairy farmers continue to manage production costs, weather-related challenges and uncertainty in the wider market.
What the Announcement Means for Suppliers
The July price increase improves the payment rate for milk supplied during the month, while the feed discount is designed to help reduce costs during prolonged dry weather. The top-up payment provides further financial support for eligible milk supplied earlier in the year.
Kinisla’s market outlook also points to the potential importance of European milk supply and demand in shaping dairy prices over the coming months.