Milk processor Robert Wiseman Dairies is set to increase the price it pays its suppliers as supply worries continue.

In a trading statement released before the first year-end on 29 March, Wiseman said an increase was needed to ensure the dairy had enough milk to meet requirements.

The increase will come despite weaker bulk cream prices, which would usually lead to lower milk prices, the dairy added.

Hiher selling prices

Billy Kean, Wiseman's finance director, said the dairy had begun implementing higher selling prices to allow them to pay their suppliers more to cover "exceptional cost increases" milk producers faced over the past year.

"We believe the increase is required to improve our position with regard to milk price paid and to ensure we have sufficient milk to meet our requirements in the coming year," he said.

The trading statement revealed Wiseman's turnover and sales volume for the last 12 months had been in line with expectations, with a number of product lines performing strongly.

The One Milk

Sales of 'the One' milk, the first 1% fat milk to be launched in the UK, had increased by 34% over the past 12 months following a £2m advertising campaign.

Sales of extended shelf life milk also showed a strong increase of 25% on the year.

However, the dairy admitted it would face extra costs of £1m in the first quarter of the new year because of a delay in the first phase of commissioning at its new dairy in Bridgewater in southwest England.

The company's full year preliminary results will be announced on 12 May.