Dairy co-op First Milk will not be dropping the price it pays farmers in March.
A day ahead of its AGM, the business has announced it is freezing farmgate prices for both its milk pools.
Farmers supplying the co-op on liquid contracts will be paid 21.2p/litre and those in the manufacturing pool will receive 21.57p/litre.
The news offers some respite to First Milk members, who suffered a two-week payment delay earlier in January as the co-op needed to plug a £10m cashflow hole.
Global dairy markets have started to creep slowly upwards in the past month, allowing other major milk processors Muller Wiseman and Arla to hold their next farmgate prices.
Pembrokeshire dairy farmer and First Milk vice-chairman Nigel Evans said First Milk was “acutely aware” of the impact market volatility and the recent shock announcement had on members.
He said the business was in stronger shape heading into the spring flush.
“We remain very cautious about the impact of cheese stocks which are yet to come on to the market and the consequences of higher milk volumes being produced around Europe this spring,” Mr Evans said.
“But right now markets are relatively quiet and therefore we are able to hold our March milk prices.”
First Milk farmers have suffered the most from crashing dairy markets, with farmgate prices dropping more than 10p/litre from their 32.5p/litre high last spring.
Latest Defra figures show the UK’s average milk price fell 3.3% to 27.85p/litre in December. This was 19% down on the same month in 2013.