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).
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).