Arla UK cuts its milk price for May supplies

Arla Foods in the UK has decided to cut its on-account price for May supplies of milk to the co-op 0.75p/l (0.95c/L).

When this reduction is applied to the UK standard litre it brings the co-op’s May milk price to 20.12p/L (25.76c/L).

A statement from the co-op said that the imbalance between global supply and demand continues to significantly impact the market. In addition, it said that cheese stocks remain high.

These, coupled with the very competitive market environment, have generated a further downward pressure on prices, the co-op said.

Arla Foods amba Farmer Board Director, Johnnie Russell, said that the continuing decline of milk prices is of deep concern to all involved in the dairy industry and the entire world market is at an unsustainably low level right now.

Arla is doing all it can to mitigate the downturn of the markets and is working hard to move the extra milk volume from our farmer owners into branded sales and foodservice.

“However, even those areas are also now being affected by the global imbalance between supply and demand.”

Arla is also informing its farmers supplying milk on a direct contract of a 0.9p/L reduction in the milk price taking it to 15.1p/L (19.33c/L) from June 1, 2016.

Arla Foods is a global dairy company and co-operative owned by 12,700 dairy farmers with circa 2,700 of whom are British.