It has been revealed that Glanbia’s Fixed Milk Price Scheme for 2018 has been “significantly oversubscribed”.
The news was confirmed by the Chairman of Glanbia, Henry Corbally, as he announced the processor’s milk price increase for June supplies.
The scheme is set to pay a fixed price of 32c/L for the full year of 2018; allocation volumes are expected to be communicated to suppliers in the coming weeks, according to Glanbia.
Details of the scheme were announced at the end of May and applications closed on Friday, July 7.
Glanbia hoped that its phase 10 Fixed Milk Price Scheme would offer milk suppliers the option to protect a portion of their milk supply, from the extremes of market price volatility.
Participants in the ninth phase of the scheme were expected to be given priority access to the newest phase, for 100% of their phase nine allocation volume.
At the time of the launch of the 2018 scheme, Corbally explained that Glanbia is acknowledged as a global leader in the development of market price volatility tools – having launched a Fixed Milk Price Scheme every year since 2011.
A total of 20% of Glanbia’s milk pool is now in Fixed Milk Price Schemes, with over 60% of suppliers participating, he added.
As these schemes are totally voluntary, the chairman was happy to declare that – at the end of May – over 2,000 Glanbia farmers were availing of the option to reduce milk price risk on a portion of their milk supply.
This figure is subject to change once the newest phase of the scheme is taken into account.
Meanwhile, the Director of Strategy and Supply Development with Glanbia, Sean Molloy, previously explained that suppliers who were participating in active schemes at the end of May had, on average, 25% of their supply volumes in fixed-price arrangements (based on 2016 supply volumes).
He added that the processor would continue to explore “innovative ways” to help its milk suppliers and customers cope with market price volatility.