11 January 2002

Dispute erupts into war of words over supply

A LONG-RUNNING dispute between two of the UK milk industrys leading players has erupted into a bitter war of words.

The row dates back to April 2001, and centres around a disagreement, currently subject to litigation, involving First Milk and Express Dairies over the supply of milk to the retail market.

First Milk says it has now been forced to halt the supply of milk (believed to be more than 0.5m litres/day) to Expresss dairies at Liverpool, Nottingham and Wythenshawe, accusing the firm of trying to pressure it into lowering prices.

"In late December we were presented with demands from Express which were unreasonable to our members and to our other customers, and which would have significantly weakened bothfarmgate and retail prices," said First Milk chairman John Duncan.

However, Neil Davidson, chief executive at Express, described the claim as "outrageous".

"Throughout the year First Milk has refused to guarantee security of supply and we wrote to them terminating the contract on Dec 20.

"There was no discussion about pricing and any responsibility for a subsequent cut in payments to First Milks members must rest solely with its leadership. It is not in our interests to weaken prices." &#42