Arla sign© Francis Dean/REX/Shutterstock

Arla’s price for conventional milk for UK farmer-owners will increase by 1.5p/litre from 1 October, taking the co-op’s manufacturing litre to 32.3p.

This is made up of a one euro cent increase in the on-account (monthly) price alongside the quarterly adjustment made by using the processor’s currency smoothing mechanism.

For the UK standard conventional manufacturing litre, the on-account price rise is 0.84p/litre, while average exchange rate changes between July and September make a positive impact of 0.66p/litre.

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“This is the fourth consecutive increase in Arla’s milk price, totalling 4.56p – a 16% increase in our price since the beginning of July,” said Arla Foods amba board director, Johnnie Russell.

“The increase reflects the continued strength in the markets across Europe, particularly for fat-based products.”

The prices are for manufacturing contracts and based on every other day collection of top-quality band milk, with a minimum 1m litre volume at 4.2% butterfat and 3.4% protein.

Arla Foods is transitioning to a manufacturing schedule only with effect from 1 January 2018, where Arla farmers will be paid on constituents.

For comparison, the liquid price is 31.06p/litre, based on 4% fat and 3.3% protein.