Milk Price III

Buford T. Justice XIX · 21-02-2017 5:26pm

boggerman1 wrote: »

Gdt down 3.5%.30 cents might be a good price for 2017.not this talk of 33-35 cents.

All the major product categories down

https://www.globaldairytrade.info/en/product-results/

Farmer Ed · 21-02-2017 7:29pm

http://www.radionz.co.nz/news/national/316072/silo-collapse-probe-finds-cracks-in-four-others

Could this happen here? From what I am hearing back some well known Co Op managers this side of the planet, could well consider taking up welding classes as a similar situation with cracking tanks is developing here. On a serious note, 500 tons of milk running out the gates of a plant in the the local town is no laughing matter.

Panch18 · 21-02-2017 7:44pm

boggerman1 wrote: »

Gdt down 3.5%.30 cents might be a good price for 2017.not this talk of 33-35 cents.

if lads can get 30 for the big production months i'd say they could be doing about as well as could be expected.

I'm not sure what indicators fellas are seeing to predict continuous increases in milk price

Farmer Ed · 21-02-2017 8:26pm

The last thing we need to be doing now is talking the price down. We have already beaten the 30c. If it only makes 30 for the peak months, that will mean a price drop in the next couple of months. Hard to see that going down well.

alps · 22-02-2017 12:00pm

Glanbia's profits have increased and they are paying out 13.31c/share dividend. For those of us not in the know, how much of a bonus is this to a supplier? I know it's like asking how long is a piece of string, but for an operator with glanbia for say 20 years, would it add 3c/l to his supply, or is this just stupid question..?

rangler1 · 22-02-2017 12:16pm

alps wrote: »

Glanbia's profits have increased and they are paying out 13.31c/share dividend. For those of us not in the know, how much of a bonus is this to a supplier? I know it's like asking how long is a piece of string, but for an operator with glanbia for say 20 years, would it add 3c/l to his supply, or is this just stupid question..?

They pay really good dividends, don't know how they expected us to sell some of our old shares last year

atlantic mist · 22-02-2017 1:32pm

http://www.independent.ie/business/farming/dairy/shopkeepers-in-one-us-state-face-prison-if-they-sell-kerrygold-butter-35472604.html

Farmer Ed · 23-02-2017 6:26pm

Rumours of artificial sweetness company interested in Glanbia? Some might consider that appropriate given their experiences. http://m.independent.ie/business/farming/agri-business/could-glanbia-be-bought-out-by-japanese-food-firm-35475628.html?utm_content=bufferee789&utm_medium=social&utm_source=facebook.com&utm_campaign=buffer The artificial sweetness that is.

boggerman1 · 07-03-2017 7:45pm

Gdt hammered down 6.3%.and most worringly of all wmp is down to 2700$ a ton from a couple of months ago where it was at 3500 approx.is the price recovary of irish prices going to be short lived.i not talking down the price but a large dose of realism is needed.not the deluded ifa/icmsa looking for 33-35 cents now.

Farmer Ed · 07-03-2017 9:31pm

boggerman1 wrote: »

Gdt hammered down 6.3%.and most worringly of all wmp is down to 2700$ a ton from a couple of months ago where it was at 3500 approx.is the price recovary of irish prices going to be short lived.i not talking down the price but a large dose of realism is needed.not the deluded ifa/icmsa looking for 33-35 cents now.

I'm no fan of IFA and ICMSA and I understand you are not trying to talk down the price. But in fairness if they were to do what farmers are paying them to do, then they should be fighting for every last cent. Can't fault them if they are talking up the price a bit. Credit where credit is due.

Don't let the processors use NZ prices to depress us. Things seem to be looking more positive in europe and that is at least in theory is our home market.
http://www.agrimoney.com/news/dairy-giants-hope-volatile-milk-market-has-finally-found-a-balance--10498.html

Fixture · 07-03-2017 10:31pm

I know it's 10 years on the go and I know it brings transparency but I'm still convinced the very existence of the GDT increases dairy market volatility. NZ weather or production lifts and within two weeks there's an online auction to shout "SUPPLY" or "NO SUPPLY" around the dairy trade globally. Would the market jump less frequently without it??

Is it pride prevents the kiwi lads from ending it? They set it up to bring "price discovery" so kiwi farmers could see open market price and end rows about the fonterra price. It has probably succeeded in that aim - most kiwi farmers online seem to blame market rather than fonterra for price drops, which must please the well paid suits in HQ.
But given their strong position on global market, are they doing themselves and everyone else harm? I know market is all about supply and demand, but do other industries run similar online exchanges? Maybe I'm just sick of reading GDT results...

Farmer Ed · 07-03-2017 11:01pm

Fixture wrote: »

I know it's 10 years on the go and I know it brings transparency but I'm still convinced the very existence of the GDT increases dairy market volatility. NZ weather or production lifts and within two weeks there's an online auction to shout "SUPPLY" or "NO SUPPLY" around the dairy trade globally. Would the market jump less frequently without it??

Is it pride prevents the kiwi lads from ending it? They set it up to bring "price discovery" so kiwi farmers could see open market price and end rows about the fonterra price. It has probably succeeded in that aim - most kiwi farmers online seem to blame market rather than fonterra for price drops, which must please the well paid suits in HQ.
But given their strong position on global market, are they doing themselves and everyone else harm? I know market is all about supply and demand, but do other industries run similar online exchanges? Maybe I'm just sick of reading GDT results...

It has certainly been used many a time as a stick to beat us with.

kowtow · 07-03-2017 11:03pm

Fixture wrote: »

I know it's 10 years on the go and I know it brings transparency but I'm still convinced the very existence of the GDT increases dairy market volatility. NZ weather or production lifts and within two weeks there's an online auction to shout "SUPPLY" or "NO SUPPLY" around the dairy trade globally. Would the market jump less frequently without it??

Is it pride prevents the kiwi lads from ending it? They set it up to bring "price discovery" so kiwi farmers could see open market price and end rows about the fonterra price. It has probably succeeded in that aim - most kiwi farmers online seem to blame market rather than fonterra for price drops, which must please the well paid suits in HQ.
But given their strong position on global market, are they doing themselves and everyone else harm? I know market is all about supply and demand, but do other industries run similar online exchanges? Maybe I'm just sick of reading GDT results...

To be honest, if we are all cursing the GDT it is probably doing it's job pretty well.

Most high volume commodities are traded on more or less transparent exchanges - in fact the soft agricultural goods were the genesis of the futures exchanges, long before financial instruments were traded on them. The ability to hedge price on forward contracts saved farmers and probably prevented famine by signalling farmers to stop planting or start planting particular crops a season ahead of the harvest.

Actually milk & dairy products are the one agricultural complex that has really struggled to get any volume and transparency... mainly because milk itself is a short shelf life product and it is still primarily consumed close to the point of production, as liquid milk and local cheese.

There are some futures contracts in Chicago, although they are very illiquid, and there is the NZX and the accompanying GDT. Both of those, as you would expect in NZ, primarily reference the very small amount of milk which is internationally traded but which is the lifeblood for NZ & Ireland. Those are good as far as they go.

The real difficulty is that traded milk is already marginal milk - not wanted locally - and it is therefore an inherently volatile product - it's price will always tend to be close to the variable cost of production of spare litres across all producing countries (note, not the fixed costs, which are set up to produce premium liquid milk).

There are suggestions from time to time of a European exchange, but frankly I think more exchanges are likely to make things worse - you can't run a liquid futures contract without speculators to close the gap between farmers and processors, and there's hardly enough appetite as it is to speculate in milk without splitting the book across continents.

I don't think the price action in the GDT so far this year is particularly indicative of a sustained drop, it could just as easily settle out or climb again, but as long as oil prices stay in check and America keeps producing, and as long as the big overhangs of stock like the EU SMP pile remain uncleared, it's difficult to see a strong run upwards as well.

If we can't make a living with a 30c / litre base price it is our National business plan we need to be looking hard at, not the GDT results.

alps · 08-03-2017 12:24pm

Milk prices

Farmer Ed · 08-03-2017 12:49pm

alps wrote: »

Milk prices

Based on that, our own two representatives still have a bit of catching up to do.

If it was a soccer league table they are very much in the relegation zone.

Siobhan et al, obviously worth every penny, fair achievement to be able to squeeze irish farmers that much.

Waffletraktor · 08-03-2017 12:56pm

Farmer Ed wrote: »

Based on that, our own two representatives still have a bit of catching up to do.

If it was a soccer league table they are very much in the relegation zone.

Siobhan et al, obviously worth every penny, fair achievement to be able to squeeze irish farmers that much.

Ya, but what do you expect when they have to put most of it on a boat vs a truck to the local town :rolleyes:.

Buford T. Justice XIX · 08-03-2017 1:33pm

For what it's worth, I had a text from a lad I know that's fairly well clued in. Apparently, a senior Kerry rep has told our representatives to budget for a milk price of 30c/l on average for the next 10 years!

Farmer Ed · 08-03-2017 2:26pm

Buford T. Justice V wrote: »

For what it's worth, I had a text from a lad I know that's fairly well clued in. Apparently, a senior Kerry rep has told our representatives to budget for a milk price of 30c/l on average for the next 10 years!

That's all very well, but is the senior Kerry rep accepting a pay freeze for the next ten years also?

Farmer Ed · 08-03-2017 2:35pm

Waffletraktor wrote: »

Ya, but what do you expect when they have to put most of it on a boat vs a truck to the local town :rolleyes:.

If you examine Alps link, the rolling average for Fonterra in 2016 is roughly six cent ahead of Glanbia. On a million litre supply that would equate to a NZ farmer being being paid 60k more for his milk in 2016.

Last time I checked New Zealand was still an island and much further away from centers of population than we are.

jaymla627 · 08-03-2017 2:47pm

Farmer Ed wrote: »

If you examine Alps link, the rolling average for Fonterra in 2016 is roughly six cent ahead of Glanbia. On a million litre supply that would equate to a NZ farmer being being paid 60k more for his milk in 2016.

Last time I checked New Zealand was still an island and much further away from centers of population than we are.

But what about all the fixed price schemes/co-op support payments/milk flex/gap scheme loans etc etc, its pretty clear the Plc want our milk for the least possible price and hide behind the above to try and get away with paying the worst milk price in the country when all the above is stripped back, the only bright light about this new spin out is they won't dare cut our lag behind other processors till they get it over the line, then it will be back to corbally/bergin back to conditioning us for price cuts and how the markets are fragile/influx

Buford T. Justice XIX · 08-03-2017 3:58pm

Farmer Ed wrote: »

That's all very well, but is the senior Kerry rep accepting a pay freeze for the next ten years also?

Someone has to make the sacrifices, Ed.

I, for one, am proud that Kerry pays the leading milk price, on a like for like basis, once you leave out all those who pay more than Kerry, which is just about everyone else.

All hail our glorious Overlords!

Farmer Ed · 08-03-2017 4:34pm

Buford T. Justice V wrote: »

Someone has to make the sacrifices, Ed.

I, for one, am proud that Kerry pays the leading milk price, on a like for like basis, once you leave out all those who pay more than Kerry, which is just about everyone else.

All hail our glorious Overlords!

Maybe we should all just become monks and move to somewhere like Lough Derg. Sacrifice and fasting would at least be voluntary and praying should be way more beneficial for us than the colorful language we might often use when we open our milk statments. And worshiping God would be a much more logical and rewarding thing the do rather than worshiping the false Gods that are our overpaid overlords.

whelan2 · 08-03-2017 4:38pm

jaymla627 wrote: »

But what about all the fixed price schemes/co-op support payments/milk flex/gap scheme loans etc etc, its pretty clear the Plc want our milk for the least possible price and hide behind the above to try and get away with paying the worst milk price in the country when all the above is stripped back, the only bright light about this new spin out is they won't dare cut our lag behind other processors till they get it over the line, then it will be back to corbally/bergin back to conditioning us for price cuts and how the markets are fragile/influx

I wonder will they also try and keep us all on side for when the MSA's are up ?

alps · 08-03-2017 4:58pm

alps wrote: »

Milk prices

I'm really surprised at the strength of the fonterra price. Who would have known.?

As to the validity of these figures, I do know that a farmer from each of the above processors sends a copy of his monthly statement to the organisers of the survey, so that it is first hand farmer info and not sent from the processor..

wats the craic · 09-03-2017 7:36am

whelan2 wrote: »

I wonder will they also try and keep us all on side for when the MSA's are up ?

what do you think the new spin out in shares is for only buy off lads to sign up again .

Buford T. Justice XIX · 09-03-2017 9:08am

alps wrote: »

I'm really surprised at the strength of the fonterra price. Who would have known.?

As to the validity of these figures, I do know that a farmer from each of the above processors sends a copy of his monthly statement to the organisers of the survey, so that it is first hand farmer info and not sent from the processor..

One of the reasons for the strong Fonterra price is that they are selling less through GDT and targeting higher margin products for their Milk through their own networks.

Waffletraktor · 09-03-2017 2:36pm

Buford T. Justice V wrote: »

One of the reasons for the strong Fonterra price is that they are selling less through GDT and targeting higher margin products for their Milk through their own networks.

And they have massaged their currency in fear of a shared ozzy bank crash.

alps · 13-03-2017 3:47pm

There will be an announcement about the time schedule for the milk reduction scheme, within the next 2 weeks. That means it's not coming in March...

Timmaay · 13-03-2017 4:01pm

Any sign of a Feb milk price? If ever I needed a nice 35c base price, and for the milk cheque to be lodged in the account on thur (before paddy's day ha!). Penniless at the sec and need to squeeze every last bit outa the small Feb milk cheque, I probably shoulda carried over afew more K from each of the autumn cheques instead of spending like there was no tomorrow ha.

Buford T. Justice XIX · 13-03-2017 4:03pm

alps wrote: »

There will be an announcement about the time schedule for the milk reduction scheme, within the next 2 weeks. That means it's not coming in March...

Are you surprised?:D

Over promise and under deliver seems to be the Dept motto atm.

Farmer Ed · 13-03-2017 4:12pm

Buford T. Justice V wrote: »

Are you surprised?:D

Over promise and under deliver seems to be the Dept motto atm.

I could be wrong about this but there is something in my head that says that payments for this scheme have to be made within 90 days. That would mean before the end of March. Don't ask me what the consequences for the Department might be if they fail to make that deadline?

whelan2 · 13-03-2017 4:14pm

Timmaay wrote: »

Any sign of a Feb milk price? If ever I needed a nice 35c base price, and for the milk cheque to be lodged in the account on thur (before paddy's day ha!). Penniless at the sec and need to squeeze every last bit outa the small Feb milk cheque, I probably shoulda carried over afew more K from each of the autumn cheques instead of spending like there was no tomorrow ha.

31cpl, calf sales keeping me ticking over here

Buford T. Justice XIX · 13-03-2017 4:18pm

Farmer Ed wrote: »

I could be wrong about this but there is something in my head that says that payments for this scheme have to be made within 90 days. That would mean before the end of March. Don't ask me what the consequences for the Department might be if they fail to make that deadline?

The consequences probably mean that the money will be cut for farmers:(

Anyway, you're right, it has to be paid by the end of the month. I'd forgotten that.

Farmer Ed · 13-03-2017 4:31pm

Buford T. Justice V wrote: »

The consequences probably mean that the money will be cut for farmers:(

Anyway, you're right, it has to be paid by the end of the month. I'd forgotten that.

To be honest from what I know there is only a couple of lads in that office dealing it, and from what I gather from any dealings I have had with that office and from what I have heard back from people who have had dealing with them, they come across as pretty decent old skins. So fingers crossed they will do their best.

Not sucking up to the department or anything here. But Ill be very disappointed if those two lads will let us down.

Might come as a shock to some. But I would complain if I thought there might be a problem

I really hope there wont!

Buford T. Justice XIX · 13-03-2017 10:07pm

Glanbia hold price, Carbery rise by 1.5c

http://m.independent.ie/business/farming/dairy/glanbia-holds-milk-price-and-announces-details-of-2m-seasonality-scheme-35526177.html?utm_content=buffer5dc22&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Also some details about a seasonality payment there too.

Mooooo · 14-03-2017 8:03pm

Dairygold held at 31. Feck em

Buford T. Justice XIX · 15-03-2017 12:03am

Mooooo wrote: »

Dairygold held at 31. Feck em

Kerry hold at 31c as well.

http://m.independent.ie/business/farming/dairy/two-more-coops-hold-february-milk-price-35531678.html?utm_content=bufferc4789&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Farmer Ed · 15-03-2017 10:53am

Buford T. Justice V wrote: »

Kerry hold at 31c as well.

http://m.independent.ie/business/farming/dairy/two-more-coops-hold-february-milk-price-35531678.html?utm_content=bufferc4789&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Unfortunately they usually try and keep pace with each other.

whelan2 · 15-03-2017 1:26pm

Got my allocation for fixed price schemes 8&9 got 52% of what I applied for in scheme 8 and 29% of what I applied for in scheme 9. A lot more than what I normally get

whelan2 · 16-03-2017 6:56am

Timmaay wrote: »

Any sign of a Feb milk price? If ever I needed a nice 35c base price, and for the milk cheque to be lodged in the account on thur (before paddy's day ha!). Penniless at the sec and need to squeeze every last bit outa the small Feb milk cheque, I probably shoulda carried over afew more K from each of the autumn cheques instead of spending like there was no tomorrow ha.

Your wish is granted money in account today

orm0nd · 16-03-2017 11:05am

Mooooo wrote: »

Dairygold held at 31. Feck em

actually the way markets are at present a price around 30/31 might mean better stability for the back end,

mahoney_j · 16-03-2017 11:17am

orm0nd wrote: »

actually the way markets are at present a price around 30/31 might mean better stability for the back end,

+1

Keepgrowing · 16-03-2017 2:44pm

orm0nd wrote: »

actually the way markets are at present a price around 30/31 might mean better stability for the back end,

Have to agree. Markets are far from buoyant in recent times and the massive turnaround expected by some is slow to materialise. This is not bad as it tempers expectations yet is a fair bit better than this time last year.

The fixed schemes are looking more attractive every day.

RightTurnClyde · 16-03-2017 3:05pm

orm0nd wrote: »

actually the way markets are at present a price around 30/31 might mean better stability for the back end,

How do the low Irish prices stabilise the markets when the most of rest of Europe is getting 7+% more than us and the US is getting 10% more than us?
(Referring to Alps post #565 earlier)

cute geoge · 16-03-2017 3:08pm

Is there any where in the world getting a worse price for there milk is what i am beginning to wonder

Buford T. Justice XIX · 16-03-2017 4:40pm

RightTurnClyde wrote: »

How do the low Irish prices stabilise the markets when the most of rest of Europe is getting 7+% more than us and the US is getting 10% more than us?
(Referring to Alps post #565 earlier)

As kowtow posted in the last thread, the rest of the high price processors are investing in value added and consumer products while we are competing in the surplus milk market, where there is no R&D and the lowest price possible to sell in bulk.

cute geoge · 16-03-2017 4:54pm

Buford T. Justice V wrote: »

As kowtow posted in the last thread, the rest of the high price processors are investing in value added and consumer products while we are competing in the surplus milk market, where there is no R&D and the lowest price possible to sell in bulk.

I can not understand that so you are saying that all kerry's and glanbia milk is surplus milk.

Farmer Ed · 16-03-2017 4:58pm

Buford T. Justice V wrote: »

As kowtow posted in the last thread, the rest of the high price processors are investing in value added and consumer products while we are competing in the surplus milk market, where there is no R&D and the lowest price possible to sell in bulk.

But were we not told that the reason the investments made by some of our processors here over the past couple of years, that in some cases cost multiple times what would normally be expected, was because they were going to manufacture high end value added products? Hmmm?

Is it possible they might have been lying to us???

Now we hear stories that at least some of those overpriced structures will most likely have to be replaced because of faulty design.

Meanwhile better managed processors are under less pressure to pay a good price, resulting in everyone being effected.

Buford T. Justice XIX · 16-03-2017 6:19pm

cute geoge wrote: »

I can not understand that so you are saying that all kerry's and glanbia milk is surplus milk.

Powdered milk is surplus milk in most markets. It's what they do with milk that's surplus to their daily needs for value added products.

Buford T. Justice XIX · 16-03-2017 6:25pm

Farmer Ed wrote: »

But were we not told that the reason the investments made by some of our processors here over the past couple of years, that in some cases cost multiple times what would normally be expected, was because they were going to manufacture high end value added products? Hmmm?

Is it possible they might have been lying to us???

Now we hear stories that at least some of those overpriced structures will most likely have to be replaced because of faulty design.

Meanwhile better managed processors are under less pressure to pay a good price, resulting in everyone being effected.

They were telling the truth just not the whole truth. PLCs are almost obligated to purchase at least cost. And the benefit from the value added goes to the PLC and is distributed by dividend and not by milk price.

Get used to being paid just enough to keep your nose above water level would be my view on it.

Milk Price III

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