Further farmgate milk price rises for July have been announced, as milk production declines after the peak.
Suppliers in Tesco’s Sustainable Dairy Group (TSDG) through Muller will receive 42.35p/litre from 1 July for a standard litre of 4% butterfat and 3.3% protein, an increase of 0.76p/litre on June levels.
This adjustment is to reflect the latest quarterly increases in fuel, feed, and fertiliser costs at 3.16p/litre by Promar as part of its cost tracker.
The cost tracker also includes variable costs of 23.03p/litre, overhead costs of 13.79p/litre, and depreciation of 2.37p/litre, to bring cost of production to 39.19p/litre.
A Tesco spokesman said: “We understand the difficulties farmers are facing, which is why in March we stepped up our support for the British dairy industry by significantly increasing the price we pay for all our fresh milk, with an increase of close to 20% effective from last month.
“We are continually reviewing the situation in light of the fast-changing market conditions to ensure our cost of production pricing model provides the stability our farmers need for the future.”
Suppliers that are part of Sainsbury’s Dairy Development Group will receive a July price of 41.7p/litre for those on Muller contracts and 41.58p/litre for those on Arla contracts for a standard 4% butterfat and 3.3% protein litre.
This puts both retailers behind the pace of the market, with many processors paying about 45p/litre and current spot milk prices reportedly achieving between 46p/litre and 50p/litre.
Medina Dairy is set to increase its milk price by 5.2p/litre from 1 July, bringing it to 45p/litre for a standard litre of 4% butterfat and 3.3% protein.
This equates to a rise of 15.2p/litre since the start of 2022, according to milkprices.com.
Suppliers to cheesemaker Wyke Farms will receive a July price of 46.92p/litre for a manufacturing litre of 4.2% butterfat and 3.4% protein, up from a June price of 43.81p/litre.
This equates to a standard liquid price of 45.3p/litre.
Producers supplying Meadow Foods will receive 46p/litre for a standard liquid litre for July.
Figures on milkprices.com show this is an increase of 3.75p/litre on the previous month and 17p/litre on the same month last year.
Jim Bebb, Meadow Foods supply chain director said: “This latest price rise allows us to maintain our position at the front of the pack and to continue to support our producers with the ongoing inflationary cost pressures they face on farm, as well as the increasing cost of living challenges.”
Müller’s Co-operative Dairy Group is due to pay a July price of 43.35p/litre for a standard litre, an increase of 2.17p/litre on the previous month.