Ornua today (Wednesday, February 5) confirmed that the Purchase Price Index (PPI) for the month of January is 161.9 - up on the December index of 159.3.

After deducting estimated processing costs, Ornua’s PPI "implies" an indicative return of 48.3c/L, including VAT for milk of 3.6% fat and 3.3% protein.

This represents an increase from the previous month of 47.6c/L.

According to Ornua "the results reflect strong market returns for the month of January".

It also stated that the PPI relates to product settlements or payments for the month and for reasons of seasonality "is not directly aligned with milk production and payment".

However according to Ornua the PPI can provide a reference as to how the general dairy market is performing and "may help to guide expectations around likely returns for dairy products and the milk used in their manufacture". 

According to Ornua, one of the country's  largest exporters of dairy products, its estimate of member co-ops processing costs was 9.5c/L in the month, compared to 9.1c/L in the previous month.

It detailed that these estimated processing costs are based on Ornua’s estimate of the average cost of processing the Ornua basket of products, which is not representative of any individual member co-op processor.

Meanwhile, the Ornua value payment payable to member co-ops in the month is €0.3 million which equated to 1.0% of gross purchases in the month. 

Meanwhile the Global Dairy Trade (GDT) index has recorded an increase of 3.7% following the latest auction event yesterday (Tuesday, February 4).

The index figure now stands at 1,264, the highest figure since July of 2022.

The 3.7% increase follows on from a 1.4% increase that was recorded on January 21.

The index has now seen two increases in succession, following two decreases in succession on December 17 and January 7.

Of the last 12 GDT trading events (including today’s), going back to August 20, the index has recorded eight increases versus four decreases.