First Milk cuts liquid milk price by 2p/litre from June

First Milk has followed its competitors by cutting its liquid milk price by 2p/litre and its manufacturing pool price by 0.5p/litre.


Co-op members on liquid contracts will be paid 30.5p/litre from June and those on manufacturing contracts will be paid 32p/litre.
 
“I am sure that you will have seen the downward trend in global commodity markets over the last few months. For example, the Global Dairy Trade auction is down nearly 20% since February, First Milk Chairman Sir Jim Paice said in a statement to members.


“As your Board, we have been closely monitoring the effect on our business and you will understand that the declines in these global markets impact directly on the returns we receive.


“At this stage, the returns from cheese have not declined as much, mainly as a result of our partnership with Adams Foods. However, there is a global commodity market element built into our manufacturing pool price, and that price will be reducing as a result.


“We will continue to monitor the marketplace and its impact on us, and use our communication channels to keep members updated on market trends.”


See also: Muller Wiseman cuts milk price by 1.6p/litre


First Milk’s competitors have also been under pressure, Arla cut its price last week by 1.27p/litre from 28 April and Muller Wiseman announced a 1.6p/litre drop effective from June.


Farmers supplying Payne’s Dairies, Wyke Farms, Barbers and Glanbia have also reported lower prices, but Dairy Crest suppliers will not face a cut in May or June.


The larger dairy companies have used this week’s price cuts as a chance to put pressure on the ongoing review of the industry’s voluntary code.


Dairy Crest CEO Mark Allen said it was “unacceptable” that Arla had dropped its price with three days’ notice, rather than adhering to the 30-period set out in the code.


He said there was not a level playing field as co-operatives were also exempt from the three-month notice period for farmers to leave their buyer.


But the review’s independent chairman Alex Fergusson MSP said such comments were unhelpful and should be kept within the confines of the consultation.


The larger dairy companies have used this week’s price cuts as a chance to put pressure on the ongoing review of the industry’s voluntary code.


Dairy Crest CEO Mark Allen said it was “unacceptable” that Arla had dropped its price with three days’ notice, rather than adhering to the 30-period set out in the code.


He said there was not a level playing field as co-operatives were also exempt from the three-month notice period for farmers to leave their buyer.


But the review’s independent chairman Alex Fergusson MSP said such comments were unhelpful and should be kept within the confines of the consultation.

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