The Arla Foods amba on-account price will reduce by one eurocent per kg (0.8 pence when applied to the UK standard litre), with effect from 3 August 2015, taking the standard litre price to 23.01 pence.
Commenting on the reduction, Ash Amirahmadi, head of UK milk and member services, said:
“The downward price trend is continuing across markets globally, with the latest GDT auction down significantly by 10.7 per cent and this has put further considerable pressure on the markets. The situation is not helped by high milk production throughout the world, while demand from China and Russia, in particular, continues to be low. These global developments are impacting all dairy markets throughout the world.
“While we are doing everything we can to further reduce our costs, grow our branded portfolio, launch the Arla brand into dairy, promote our farmer-owned status, and work independently with each of our customers to find solutions to deal with market volatility, we simply cannot influence the macro factors.”
Arla Foods amba farmer board director, Jonathan Ovens, added: “As a farmer-owned business, with 3,000 British dairy farmer owners, we are painfully aware of the impact that the downturn in the markets is having at farm level and this cannot be ignored.
“It’s not a lack of effort or determination on Arla’s part; we are doing everything possible to help our owners to navigate through this increasingly tough situation, in the best possible way.”
The milk price, for the small number of Arla farmers on a direct supply contract, will reduce by 0.85 pence per litre, from 1 September 2015.