Glanbia Given Two Weeks to Fix Prices

IRELAND - 700 angry Glanbia suppliers last night attended a meeting organised by IFA in Kilkenny as a follow up to the Dungarvan meeting of three weeks ago.
calendar icon 17 July 2008
clock icon 3 minute read

Farmers wanted to hear from the Glanbia Chairman and Board Members who were present at the meeting what would be done to address the two main issues raised in Dungarvan: the need to refund the premature and unjustified June 1.5c/l price cut, and the necessity for Glanbia to use its scale and commercial muscle to pay the top milk price in the country.

Glanbia Chairman Liam Herlihy and six board members were in attendance, and in his address to farmers, the Glanbia Chairman gave a commitment to “bridge the gap” in prices between Glanbia and the better payers. IFA President Padraig Walshe asked suppliers to give the Glanbia Board two weeks to come up with a solution to both issues – and the meeting reluctantly agreed.

“Ten years ago, when Glanbia was formed, a commitment was made to pay almost 1c/l over the average of the KPMG audit for 3 years to buy farmers’ support. After the first three years, Glanbia have used their dominant position with one third of the national milk pool, and a captive supply, to pay a milk price as low as they could get away with,” Padraig Walshe said.

In what was one of the largest Glanbia suppliers’ meetings ever held, there was a strong demand that the Plc pay the top milk price in the country, without recourse to topping up a bad price by the co-op.

“Glanbia suppliers voted in favour of merging Avonmore and Waterford to form a more efficient and better diversified company which could use its larger scale to compete on the domestic and international markets, and return strong milk prices to its supplier shareholders. Ten years on, Glanbia Plc now clearly prioritises the interests of the stockmarket, who were guaranteed double digit profit growth for 2008, by seeking to purchase milk as cheaply as possible,” he added.

Chairing the meeting on the night, IFA Dairy Committee Chairman Richard Kennedy said: “Since our Dungarvan meeting, the Irish Dairy Board have increased their SMP/butter price by 2.2c/l for July, 1.4c/l of which is backdated to 1st June. Lakeland Dairies, a commodity dependent co-op, has decided to hold the price of milk for June, while Town of Monaghan actually increased its June price by 1c/l. How can Glanbia, who are more efficient and have a better product mix, persist with their 1.5c/l June milk price cut, and end up paying 2c/l less than Town of Monaghan for June milk?”

“An average Dairygold supplier will receive €600 more than a Glanbia supplier in his June milk cheque alone. There is an absolute onus on Glanbia Board Members to deliver on the refund of their unjustified 1.5c/l June price cut, and on their commitment to address the price gap once and for all,” he added.The IFA Dairy Committee Chairman Richard Kennedy assured the meeting that the next gathering of Glanbia suppliers will not be indoors.

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