UK dairy processor Muller has increased its standard non-aligned milk price by 1p/litre from 1 October.
The rise means the 700 Muller Direct producers will receive 30p/litre on its liquid contract with constituents of 4% butterfat and 3.3% protein.
As of 1 September, the retailer supplement paid by supermarkets Aldi, Lidl and Morrisons will end.
The added payment, which was introduced in August 2015 and was worth around 3p/litre at its peak, has been gradually phased out as the Muller milk price has headed upwards.
The October rise means Muller’s non-aligned milk price will have increased by over 50% in the last 12 months.
The processor said the rise reflected higher returns from butter and cream as well as an improved collaboration between Muller and its dairy farmers to maintain a level milk supply more closely aligned to forecasts.
The Muller Direct Futures Contract, which goes live on 13 September, will be discussed with interested producers this week at a series of meetings across the UK.
The contract gives Muller Direct dairy farmers the opportunity to lock in a monthly price for up to 25% of their milk volume across a 12-month period for a guaranteed monthly milk price.
“We are pleased with the response we have had to the steps we are taking to ensure that farmers who supply us have a competitive milk price and an increasing number of tools available to manage their businesses through the markets which we operate in,” said Muller agriculture director Rob Hutchison.