First Milk flag © Tim Scrivener© Tim Scrivener

Dairy co-op First Milk has increased its December A price by 2-2.5p/litre.

The rise takes farmgate prices to between 23.10p and 25.17p/litre. It means A prices have increased 50.3% on average across the processor’s four pools since June, equivalent to about 8p/litre.

The co-op, which has just under 1,000 producers, will hold December B prices at 25p/litre following a 5p/litre rise in November.

See also: Challenging short term future for milk producers

B prices are paid on volumes over 90% of the previous year’s production in a given month.

“We have continued confidence that our milk price will increase further during the first quarter of 2017,” said First Milk chairman Clive Sharp.

“These increases reflect both the improved market returns and the accelerating improvements in our own business.”

He added: “The additional increase for the Midlands and East Wales pool is the result of securing a new brokerage customer. We are also pursuing further opportunities with other customers in the area.”

First Milk had previously forecast a smaller 1p/litre price lift for December, highlighting improving market conditions and similar price rises from other processors.

First Milk December prices

Milk pool

December A price increase (p/litre)

December A price (90%) (p/litre)

December B price (10%) (p/litre)

Midlands & East Wales

2.50

23.10

25.00

Lake District

2.00

24.21

25.00

Scottish Mainland

2.00

23.24

25.00

Haverfordwest

2.00

25.17*

25.00

* Includes Tesco cheese group payment estimated at 0.84p/litre for December