The matter of fixed milk prices has been brought to my attention recently over the past few months.
Fixed price contracts are a commercial decision between dairy co-ops and their suppliers, and indeed can be an appropriate risk management tool for suppliers to guard against times of high volatility in milk prices.
I am aware that the unprecedented increase in input costs is creating particular difficulties for dairy farmers who have a significant share of their milk supply locked into fixed price contracts currently. I am pleased to see the recent move from some of the dairy co-ops, who have responded by increasing the price paid to farmers on existing fixed milk price contracts with an additional supplementary payment in response to increasing production costs.
I must emphasise that it is not within the remit of my role to intervene in commercial arrangements between supplier and purchasers. I am also aware that contractual arrangements will exist at other points of the supply chain.
However, my Department continues to monitor the market situation closely for dairy and other agri-food commodities.