ARLA FOODS has told its milk producers that their milk price will be cut by 0.35p/litre, backdated to September.
The move comes just days after Robert Wiseman Dairies, still the highest payer of all the milk buyers, announced a similar cut for September.
Gwyn Jones, head of the NFU’s dairy board, slammed the move at the launch of a report setting out a vision for the milk industry’s future.
Dairy farming was at crisis point, he said, and the industry was beginning to recognise that it could not rely on 14bn litres of production a year in the current climate of uncertainty.
For the first time, Arla pushed through the cut in the teeth of its supplier association, Arla Foods Milk Partnership.
Jonathan Ovens, chairman of the Partnership, said: “The company’s view is that they had to respond to the Wiseman cut to remain competitive.
“We told them we weren’t prepared to talk any price cuts for producers.
“I will be visiting buyers from Tesco, Morrisons, Asda and Somerfield next week, putting forward figures to back up our claim for better milk prices and explaining our cost increases.
“Farmers need more money and we’ve got to try to go out and get it for them.”
A spokesman for Wiseman said he was sickened by the cut, which maintained the differential between the two companies’ milk price at 0.6p/litre.
“We’re now in exactly the same position as we were before our cut, but we weren’t to know that when we tried to reduce the deficit,” he said.
Wiseman pays 19.76p for a standard litre of milk, and has committed to hold its price until the end of January.
Arla’s standard litre price has fallen to 19.3p for most producers and 19.8p/litre for Asda suppliers.