Milk prices at United Dairy Farmers’ latest auction fell by 3.67p/litre to 24.05p/litre, sparking criticism by the Ulster Farmers’ Union.

“This is sending out a negative signal to producers at a time when they are trying to recover from the losses they incurred last year,” said dairy chairman William Cromie.

However, UDF chief executive David Dobbin said the price was still 5.55p/litre above the same time last year, and the highest achieved at a January sale for 10 years.

“We are starting 2010 in a much better position than we were last year. The price drop is largely to do with the phasing out of export refunds – although they were removed by the EU in November, there was a huge amount of pre-fixing so refunds of up to 4p/litre were still being used up in December and January.”

Weaker global milk powder and butter prices, combined with the stronger pound and a seasonal rise in Northern Ireland milk production, were weighing on the market, he added. “But the big question now is where the trend is going.”