Wiseman hints at milk price rises in AGM statement

Robert Wiseman Dairies‘ latest trading update says it continues to perform “in line with expectations” as stronger dairy commodities continue to support its business. The firm also hinted at farmgate price rises later in the year.

Speaking at the firm’s annual general meeting, chairman Robert Wiseman told shareholders that sales volumes would benefit from an increase in business with The Cooperative Group from August, which would see Wiseman supply all the retailer’s own brand milk requirements.

Preparations were well advanced for the creation of the Co-operative Dairy Group, which would benefit around 240 Wiseman producers.

A trading statement for the business said: “Bulk cream prices have remained strong. Although the longer-term outlook remains uncertain, prices are expected to be stable during the next few months.

“Diesel costs are still subject to volatility and were some 15% higher than the equivalent period last year. Similarly, the cost of resin used to produce our plastic bottles is 18% higher than those incurred in the same period last year. As we have reported previously, both of these costs remain higher than the levels experienced when we sought recovery of higher costs from customers earlier in the year.

“Our Wiseman Milk Group members continue to receive the leading price paid by a major liquid processor for producers not aligned to a major retail customer. In recent months cheese manufacturers have continued to increase the amount paid for raw milk and therefore, to ensure the security of supplies through the winter period, we anticipate that our farmgate milk price will increase in the autumn. We realise that the overall economic environment provides challenges for all our customers; however, we need to ensure that we secure sustainable milk supplies in line with their long-term requirements.”

Over the past 12 months, the business had experienced “unprecedented” pressure on margins and significant increases in input costs, the statement said.