Dairy giant Arla has announced a 0.8p/l price rise, effective from 1 August.

Meanwhile, in a change to supply agreements, Arla members have overwhelmingly voted in favour of changing the length of a supplier’s notice to leave, from three months to a full year. Around 94% of members backed the motion, which is understood to take effect from July onwards. The move is aimed at safeguarding Arla’s current milk pool, avoiding the need to source large volumes of spot milk, which is now trading well above the 30p/l mark.

First Milk changes

There have been several changes announced as part of a recent pricing review at First Milk, including scrapping the current A and B milk pool pricing system. Farmers have been unhappy with the system which saw farmers supply contracted milk for manufacturing under an agreed A price. Surplus milk would then be processed and traded at spot price levels under their B pool, with farmers given a price top-up. However, the B price has stalled at 25p/l (below spot price) as the company is running short of milk and using all supplies for its core business.

Other developments at First Milk will see a new year-round incentive of 0.5p/l payable on additional litres if the volume produced in one month is higher when compared with the same month in the previous year.

First Milk has also announced that it will scrap transport charges from 1 September and indications are it will also announce further price increases ahead of the autumn.