Arla farmers are set to see a 0.63p/litre price reduction in July after the co-operative said it was still feeling the effects of a demand shortage caused by the coronavirus shutdown.
The benchmark manufacturing price for conventional milk will fall from 29.89p/litre to 29.26p/litre as of 1 July.
Organic producers will see their standard manufacturing price fall from 38.93p/litre to 37.62p/litre.
Prices quoted include the bonus for farmers who have completed their Arlagarden and Climate Check data.
Graham Wilkinson, UK agriculture director at Arla, said: “Despite significant redeployment measures and the start-up of the food service sector, our organic demand continues to be disproportionally affected by the Covid-19 disruption.
“Therefore, regrettably, we need to reflect the lower returns in our organic milk price while continuing to work with our customers to try to minimise the Covid-19 impact.
The move sees Arla retain its spot as the top-paying processor, but the cut is in contrast to a number of other dairies that have said they will increase prices next month.
These include Grahams, which will increase its price by 1p to 25.5p/litre, to bring it back to where it was in March.
Medina Dairy, one of the lowest-paying processors, also added 1p/litre back on to its milk price last week, bringing it up to 21.75p/litre. It shaved a total of 5p/litre from its milk price in April and May.