Sainsbury's sign© Jeff Blackler/REX Shutterstock

Sainsburys has confirmed it is dropping its milk price for aligned producers by 0.45p/litre from 1 January.

The 290 farmers in the Sainburys dairy development group received notice of the price fall in a letter last week.

The move will take the liquid standard litre price paid to aligned producers to 30.37p/litre (those supplying Sainsburys through Muller), 30.31p/litre (Arla) and 30.23p/litre (Dairy Crest).

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The retailer calculates its farmgate price based on cost-of-production figures worked out by Kite Consulting.

The fall comes as a result of a reduction in feed (-0.31p/litre), red diesel (-0.11p/litre) and fertiliser costs (-0.03p/litre).