Dairy Crest and Muller have both announced further cuts to the farmgate milk price, as the gloom that has enveloped the industry shows no sign of lifting.
Dairy Crest’s Davidstow milk price will fall by 1ppl from June 1, leaving a core price of 21.72ppl.
Müller has announced a reduction of 0.49 ppl to its standard milk price from the same date.
This will take the average standard liquid milk price for Müller Milk & Ingredients to 19.11 ppl with an additional supplementary payment, currently 2.05ppl, to be confirmed.7
Dairy Crest said its latest price cut had been agreed with its Dairy Crest Direct (DCD) supply group and applies to all farmers supplying Davidstow.
Ruth Askew, Dairy Crest’s head of procurement, said Dairy Crest was ’committed to paying a fair milk price’ but the dairy sector remained under ’extreme pressure’.
She said: "The performance of our cheese brands, underpinned by a world class supply chain, enables us to pay a premium for the high quality milk our farmers supply us.
"However, the dairy sector remains under extreme pressure. As a result, we must act responsibly to ensure that our cheese business remains competitive.
"Unfortunately this means that we must now adjust the milk price. Our Davidstow price is still one of the most competitive manufacturing contracts in the UK, particularly given the significant volumes of milk we purchase.”
She Dairy Crest continued to focus on adding value to milk and growing our brands and creating demand for British dairy products in the UK and abroad.
She said: "Production of demineralised whey and GOS is underway.
We have recently announced the relaunch of our Cathedral City brand, with new packaging now in the shops. We are further supporting the brand relaunch with new TV advertising and other promotional activities.”
Müller Milk & Ingredients agriculture director Lyndsay Chapman, said: “Markets continue to be severely depressed due to the balance of supply and demand.
"The ongoing impact of this environment is increasingly challenging for all of us within the dairy sector.
“We recognise that any further price reduction is difficult news for our farmers but we remain committed to paying a competitive and transparent milk price.
Our farmers appreciate the retailer supplementary payments paid by a number of our customers, which currently equate to over 2ppl and cushion the impact of the current market conditions to some extent.
“We have again provided 30 days’ notice of this price change, in recognition of the principles of the Voluntary Code.”
Standard litre (www.milkprices.com) milk prices
The standard litre milk prices do not include the Supplementary payments from some retail customers, which are paid to our farmers on non-aligned contracts.
In the latest milk payment these totalled an additional 2.05 ppl in the price received on non-aligned contracts.