Muller Direct’s formula milk price will drop in June for the sixth month running, as dairy markets remain weak.
Farmers in the Direct Milk producer organisation (DPO) will be paid 24.471p/litre, 0.129p/litre less than a month earlier for milk committed to the cost tracker.
The dip was caused by a further slide in cream values. The April average price of £800/t was the lowest monthly average since 2009.
On the costs side, concentrates dropped £8/t, which was the biggest fall since 2014. Fertiliser also came back to less than £200/t.
But fuel showed the opposite trend, with oil prices picking up and pulling red diesel from 39p/litre to 42p/litre.
In a letter to farmers, Direct Milk company secretary Michael Masters said further drops were forecast for price reviews in July and August.
“Much now depends on when cream market values will start to recover from the present seven-year low, as milk volumes across the EU and certainly in the UK are easing on a year-on-year basis,” he said.
Latest milk production data has provided a glimmer of encouragement for UK farmers.
The spring peak could be the lowest since 2013-14, with national output slowing since January, according to AHDB Dairy.
British farmers are pumping out about 4% less milk each day than they did last year, linked to poor prices, wet weather and sluggish grass growth.