Market report: Better milk prices for dedicated suppliers

Dairy farmers supplying dedicated retail groups, and those on cheese contracts, are receiving considerably more for their milk than non-aligned suppliers.

DairyCo’s latest milk price league table showed that most of the main retailers with dedicated supply pools had increased prices from October, while none of the non-aligned liquid contracts had moved so far.

“Apart from First Milk at the bottom and the retail contracts at the top, all prices on the August league table now range between 23p/litre and 25p/litre, which is evidence of a narrowing in prices that began at the beginning of 2010,” the DairyCo report said.

“Within that range, Milk Link is probably the milk buyer that progressed the most in August; with their 0.5p/litre increase, most of their contracts are now ranking in the first half of the league table.”

From October, the Tesco increase of 1.28p/litre for dedicated suppliers would put its Wiseman contract at the top of the league table, at 27.54p/litre. However, this increase was entirely due to the higher cost of milk production and without any market-related increase, prices remained well below September’s Actual Milk Price Equivalent of 29.8p/litre, DairyCo said.