Milk producers in the Tesco Sustainable Dairy Group (TSDG) will be paid 32.01p/litre from 1 November, a cut of just over 2p/litre on the previous six months’ rate.
This will run for six months under the cost-of-production formula calculated by Promar and reflects a similar cost-of-production formula price change announced by Sainsbury’s recently.
The TSDG has 650 members and the price includes a 0.5p/litre supplement payable only to producers who submit their cost data to Promar for the tracker.
The new price follows four consecutive increases since 2012, taking into account lower feed costs, said Tesco, which also stated that the price it paid farmers in the group was completely independent of the retail price for milk.
The new November price applies to milk supplied for Tesco’s own-brand fresh and filtered milk, single, double and extra-thick double cream.