Lakeland Dairies has announced that it is reducing its base milk price for milk supplied in February, while providing a calving bonus of 2c/L for Republic of Ireland suppliers.

The board of the processor has agreed on a base price of 48.75c/L based on constituents of 3.6% butterfat and 3.3% protein.

This price is inclusive of the 0.5c/L Sustainability Incentive Payment.

This price is down by 1c/L from the price offered for January milk.

The processor added that all suppliers will "automatically" receive a 2c/L early calving bonus.

Meanwhile, qualifying farmers will also receive a 5c/L out-of-season payment.

In Northern Ireland, a base price of 39.8p/L will be paid for milk supplied in February which is inclusive of the 0.5p/l Sustainability Incentive Payment.

This base price has also been reduced by 1p/L from last month. The 3p/L out-of-season payment will be made on top of the base price.

According to Lakeland, global dairy market demand has been more subdued in recent weeks after a period of general stability.

"Market prices are tracking marginally behind the farmgate price hence the requirement for a price correction for February milk," the dairy business said.

"Lakeland Dairies will continue to monitor the markets and will endeavour to support our farmers as best we can," Lakeland said.

Recent statistics show that the value of milk grew by 16% to €4.1 billion in 2024 due to “little change in volumes”, while milk prices rose by 17%.

The Central Statistics Office's (CSO's) preliminary estimate of agricultural operating surplus for 2024 shows an increase of 46% or €1.3 billion to €4.3 billion.

The main reason for this increase was higher prices for most agricultural outputs, most notably for milk.

The data shows that the value of agricultural output at basic prices rose by 8% (€928 million) to €12.2 billion in 2024, driven mainly by a 17% increase in milk prices.