Dairy farmers on some of the lowest price contracts have had a positive start to 2020 after two processors increased their payment rates.
Meadow Foods has increased its milk price by 0.5p/litre for a second month in a row, bringing its A litre milk price to 26p/litre.
The Chester-based firm, which specialises in supplying food manufacturers with dairy products, will pay at the new rate from 1 March.
Mark Chantler, chief executive of Meadow Foods, said: “We are aware of continued pressures on farmers and are pleased to be able to pass on this second price rise of the year.
“The market remains challenging, however we will continue to carefully monitor how both supply and demand develop over the next couple of months.”
Milk buyer Freshways has also announced a price increase from 23 February to incentivise producers to stay within their contracted monthly A volumes.
It increased prices by 1p/litre to 26p/litre, but farmers will only receive an extra 0.5p/litre if they fall more than 5% below their agreed production rate.
Dairy analyst Ian Potter said that there were regular reports that Freshways were short on volume and regular buyers of spot milk, which is currently priced at 27p-28p/litre.