First Milk suppliers face price cut as cheese trade struggles

First Milk is to cut its “A” milk price for producers supplying milk for cheese manufacturing.

The March milk price will fall by 0.6p/litre for the co-op’s four creameries and northern England balancing pool and by 0.42p/litre for the Scottish balancing pool. There will be no change to the Midlands balancing pool.

Producers supplying the Scotland balancing pool and the Lake District and Haverfordwest creamery pools will see their milk price drop to 17.51p/ litre. Those supplying Haverfordwest will still receive a Tesco winter supplement of between 1.54p/litre and 3.65p/litre.

Milk prices for those supplying the northern England balancing pool will fall to 17.52p/litre and 17.28p/litre for the Midlands and east Wales balancing pools.

See also: First Milk farmers to see increase in ‘A’ price allocation

Paul Flanagan, First Milk’s external relations and membership director, said continued weak market conditions and plentiful supply had affected the pricing mechanism for the co-op’s cheese business.

Earlier this month First Milk announced that from 1 April it would increase the allocation of members’ “A” milk from 80% to 90% of what they produced.

At the moment the “A” volume is based on 80% of the average of the previous two years’ production in each relevant month. For the 2016-17 milk year it will be based on 90%.