Omsco raises October organic milk price by 1p/litre

Omsco’s member milk price is set to rise by 1p/litre from 1 October, taking the standard litre price for a flat profile supply to 50p/litre, including bonuses.

Arla’s farmgate organic milk price for the standard manufacturing litre will remain unchanged at 56.01p/litre from 1 September.

Omsco says its increase brings the price rises suppliers have had since October 2021 to 11.5p/litre.

In a letter to members, chief executive David Williams said that among the strategies that had allowed Omsco to pay its suppliers more was simplifying the business by minimising complex production chains and focusing on efficient valuable ingredient delivery.

Omsco also recently announced that it had secured placement of its British Organic Dairy Company cheese brand in 2,400 retail stores in the US.

See also: Organic dairy premium reduces as conventional prices rise

In October 2021, the co-operative cited Brexit, the Covid-19 pandemic and significant cost inflation for an unexpected 2p/litre drop in the price paid to producers.

As well as Arla’s organic price remaining static so too will its member price for the standard manufacturing litre (4.2% butterfat and 3.4% protein) for conventional milk, at 50.35p/litre from 1 September.

This price includes the current guaranteed minimum supplementary payment (forecast 13th payment) of 1.339p/litre. 

The announcement comes with a market background described as “stable albeit with a certain level of uncertainty’’.

Arla Foods amba board director and farmer owner Arthur Fearnall said that while global commodity prices had weakened in the past month, EU prices continued to remain at a high level.

“Across Europe, we are facing a sustained decline in the overall supply of milk, however there is some stabilisation in intake levels in certain EU areas,’’ he said.

Strong farmgate prices for conventional milk have narrowed the gap between organic and the rest of the market in recent months.

Traditionally at about 10p/litre, the organic premium is now around 6p/litre and reducing.

Organic dairy accounts for up to 3% of total UK milk production.