(1) Unconfirmed Prices

(2) The milk prices listed above will vary according to the amount of milk that is required by each retailer. Additional milk will be paid for at the conventional liquid milk price of Dairy Farmers of Britain (DFB) and Dairy Crest (DC) respectively. The milk price above assumes that all litres produced are sold into the dedicated milk pools.

(3) Farmers signed up with the Promar costings survey get an additional 0.50ppl

Milk prices are ranked according to the annual average price that would be paid on a contract for 12 months going forward if the present price schedule remained the same. 

Prices listed above are exclusive of:  Capital Retentions, Administration Charges, Farmer Group Subscriptions, and VAT.

Prices listed above are inclusive of:  DairyCo Levy, Seasonality. 

Milk Price Changes

Except for Meadow Foods and Wensleydale, all dairies represented on our league table cut their milk price either in April or in May.

With the Dairy Crest M&S and the Tesco contracts both having price cuts in April, the Dairy Crest Waitrose contract is at the top of the April league table with an annual price of 28.29ppl based on the DairyCo standard litre. Waitrose is followed by Dairy Crest M&S at 27.50ppl and Tesco Local choice at 27.14ppl despite a 1.08ppl and 1.32ppl price cut respectively for April.  The 1.08ppl cut on the Dairy Crest M&S contract hides a 1.48ppl price decrease partly offset by the introduction of ‘Quality’ payment – yet another, as some might say,  rewarding low bactoscan and SCC.  Based on the DairyCo standard litre (30,000/ml Bactoscan and 190,000/ml SCC), it is worth 0.4ppl.  The 1.32ppl price decrease applied by Tesco from 1 April to their dedicated suppliers is being reflected in this month’s league table with prices ranging from 26.28ppl to 27.14ppl.  If farmers signed up to Promar costings, they get an extra 0.50ppl. 

Moving to the other milk price changes, April saw most of the price decreases applied by processors involved in the cheese and/or commodity markets.  For example: Dairy Crest Davidstow price has been cut by 1.25ppl and by a further 0.5ppl in May, First Milk has cut prices by 1.25ppl across all contracts and by a further 1ppl in May. Barbers by 2.05ppl, Glanbia by 1.48ppl and Wyke Farms by 1.30ppl.  In the current context, the 2.20ppl price decrease made by Dairy Farmers of Britain in April seems somewhat irrelevant after the news on 3 June that they went into administration and that famers are extremely unlikely to get paid for their May milk. 

In May, Arla announced that they cut their price by 1ppl.  This is their second price cut after the 2ppl decrease from January.  However, it is important to highlight that the balancing charges Arla have been applying this spring are particularly hefty.  For every litre supplied in excess of the November 2008 production level, Arla have deducted 4.5ppl in February and 6ppl decrease in March and April.  Based on the DairyCo standard litre, this balancing charge for these three months has caused the annual average price to fall by 0.15ppl.  By the nature of this charge, suppliers with a spring profile would have been most affected.

Also in May, Milk Link, Paynes Dairies, Parkham Farms and Graham’s Dairies all cut their prices by 1ppl with Caledonian Cheese cutting by 1.50ppl.  The Dairy Crest Liquid contract will also see its price cut by 0.75ppl in May taking it to 23.61ppl.  Dairy Crest stated that ‘unless there are significant market developments there will be no further liquid price changes until the next review in October.’  This declaration will bring some reassurance to suppliers on this contract and should put some pressure on the other main liquid milk processors not to drop their price any further.  Despite there reportedly being fierce competition in the middle ground, prospects for the liquid milk market look positive with the major retailers appearing to be supporting prices of liquid milk. Furthermore as we move towards the end of the spring flush there is less milk available which could reduce price pressure in middle ground markets and it also should be remembered that bulk cream prices have been strengthening in the last few months leading to the estimated cream income to a liquid processor increasing by 0.74ppl between February and May to 4.99ppl.

Erratum: In the March league table, Joseph Heler was incorrectly shown as having a 0.64ppl decrease for March.  The decrease is of 0.63ppl and should have been applied from 1 April.  DairyCo apologises for this oversight and any inconvenience caused.

April

Tesco: 1.32ppl decrease on their dedicated contracts (Wiseman, Arla, First Milk and DFOB Local Choice) from 1 April, Dairy Crest: 1.25ppl decrease on Davidstow cheese contract and 1.08ppl decrease on M&S contract from 1 April, First Milk: 1.25ppl decrease on all contracts from 1 April, Barber: 2.05ppl decrease from 1 April, Wyke Farms: 1.3ppl decrease from 1 April, Dairy Farmers of Britain: 2.2ppl decrease on all contracts from 1 April, Belton Cheese: 0.75ppl decrease from 1 April, Glanbia: 1.48ppl decrease from 1 April, South Caernarfon Creameries: 1ppl decrease from 1 April, Milk Link: 1.60ppl decrease on the Cumbrian Direct Group contract from 1 April, Joseph Heler: 0.63ppl decrease from 1 April.

May

Arla: 1ppl decrease from 1 May, Lactalis/Caledonian Cheese: 1.5ppl decrease from 1 May, Dairy Crest: 0.75ppl decrease on Liquid contract, 0.75ppl decrease on Sainsbury contract and 0.5ppl decrease on Davidstow cheese contract from 1 May, First Milk: 1ppl decrease on all contracts from 1 May, Milk Link: 1ppl decrease on all contracts except the Cumbrian Direct Group contract which decrease by 1.19ppl from 1 May, Graham’s Dairies: 1ppl decrease from 1 May 1, Paynes Dairies: 1ppl decrease from 1 May, Saputo: 2ppl decrease from 1 May, Wiseman: 1ppl decrease on Partnership contract and 0.9ppl decrease on Sainsbury contract from 1 May, Parkham Farms: 1ppl decrease from 1 May.

June
No changes announced

Standard Litre

Note: Volume is based on 800,000 litres on EODC (unless only EDC is available) on a profile equivalent to the UK national average profile of the past three years. (Details can be accessed at the link below.)