Arla milk tanker© Tim Scrivener

Arla has dropped the milk price for its direct supply farmers another 0.9p/litre.

The 40-50 farmers, who are not members of the co-op, will be paid 19.25p/litre from 1 January.

Arla’s direct supply price stood at 24.8p/litre a year ago and hit a peak of 33.5p/litre in February 2014.

The producer pool makes up about 1% of the co-op’s UK milk supply – roughly 40m litres.

Last week Arla announced it would hold the milk price for its 3,000 British members at 23.04p/litre.

See also: Muller Wiseman holds non-aligned milk price for January

At the time the co-op’s head of milk and member services Ash Amirahmadi said the firming dairy markets of the autumn had started to weaken again, as production in northern Europe rose.

“Market trends continue to be mainly supply driven, while demand is stable [but] weak, as a result of the continuing situation in Russia and China,” he said.

Market watchers will look to the next Global Dairy Trade commodity auction on Tuesday (1 December) for what direction prices will take over the winter. 

Returns on the platform steadied for two months after mid-August, before slumping in the past three fortnightly sales.