Dairy producers have finally received some meaningful price rises with milk buyers almost falling over themselves to claim their farmers were getting the best deal.

Robert Wiseman Dairies announced it would be paying 2p/litre extra for September milk. This means farmers will receive 22.22p for the firm’s standard litre.

‘Unprecedented times’

Milk procurement director Pete Nicholson said he would be surprised if prices did not rise further in such a rapidly moving market and he expected the firm would be paying 24p/litre from November.

“The fresh liquid market has always paid a premium and in these unprecedented times that principle should continue. With this policy we intend to stay ahead of the market as it moves forward,” said Mr Nicholson.

Suprise increase

This policy could be tested sooner than expected following a surprise increase from Dairy Crest, which had been accused by some of its suppliers of lagging behind Arla Foods UK and Robert Wiseman Dairies.

Those on liquid contracts will get a 2p/litre increase from September and another 3.5p/litre in October, boosting payments to an unprecedented 25p/litre.

Slower cheese prices

Farmers with milk-for-cheese contracts at Dairy Crest’s Davidstow and Hartington creameries will also benefit from the September increase, but the amount for October has not been decided yet.

Dairy Crest’s purchasing director Arthur Reeves said: “Although cheese prices have been slower to rise we are confident of being able to materially lift our prices from 1 October.”

‘Delighted’

Ian Sharman of Dairy Crest Direct, which supplies most of Dairy Crest’s milk, said: “We are delighted that Dairy Crest is the first major processor to hit the 25p/litre mark.”

Arla Foods UK said a September increase wasn’t on the cards, but the firm’s director of milk procurement Peter Walker said the firm was hoping to deliver a “significant” increase from October 1 “in-line with suppliers expectations”.

Disenchanted

Dairy farmers watching the markets for spot milk and commodities soar ever higher have become increasingly disenchanted with their own payments failing to follow suit.

However, with milk supplies falling – July production was almost 9.5% below quota, taking the deficit for the year to 7.4% – some producers are starting to flex their muscles.

Unrest

This week 19 farmers in south-west Scotland told Robert Wiseman Dairies they would be selling their 60m litres elsewhere from November. Whether these latest rises will be enough to quell the unrest remains to be seen.

Sources say that some smaller milk buyers are already having to pay over 35p/litre to secure supplies on the spot market.