Having held its April price, Milk Link has cut the price it pays farmer suppliers by 1p/litre from 1 May.
The cut will be applied through an alteration to constituent payments for those on a manufacturing-style contract and on the base price for those on a liquid-style contract. It means Milk Link’s standard price for May will be 23.95p/litre.
At the same time, the board approved a member processing interest payment relating to 2008/09 of £4.1m. On average it will be worth about 0.4p/litre across the total volume of milk supplied in the year and will be paid into qualifying members’ bank accounts on 29 May.
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Commenting on the price reduction for May, Milk Link chief executive Neil Kennedy, said: “Overall, trading conditions within the dairy market remain fragile and this combined with the general economic downturn means that returns continue to be under pressure.
“As a farmer owned co-operative we are doing everything in our control to minimise the impact on members’ returns of the current weakness in the dairy market, as demonstrated by the fact that we have cut later and by less than others in the market.
“However, we fully appreciate the financial effect that any cut will have on our members’ businesses especially at a time when input costs remain high. As such, we are focused on identifying and implementing major, fast returning programmes to take out costs and improve profitability across the business.”
There will be no change to the Milk Link organic member price for May.