Müller holds milk price – but for how long?

By Rod Addy

- Last updated on GMT

Müller Wiseman Dairies said it aimed to improve production efficiencies
Müller Wiseman Dairies said it aimed to improve production efficiencies

Related tags Supply and demand

Müller UK & Ireland Group has confirmed that its standard milk price for February 2015 will be unchanged, but has stressed it couldn’t guarantee prices beyond that point.

“We recognise that this is a tough time for dairy farmers,”​ said Carl Ravenhall, md of Müller Wiseman Dairies.

In a thinly veiled snub to dairy rivals, he added: “… We are doing everything we can to maintain a leading milk price, whilst retaining our ability to compete, particularly against processors and farmer owned co-operatives who reduce their milk prices with little notice.”

However, he warned: “Given the further weakening of the value of dairy commodities and the continuing global supply and demand outlook we are unable to rule out further milk price adjustments to reflect the poor returns from cream and butter products and the need for us to remain competitive in a UK and international context.”

Increase efficiency

He said Müller was doing all it could to increase efficiency, cut production costs and develop goods that would best profit suppliers, boost sales and offer a broader product range.

The company is offering a standard price of 25.90 pence per litre to Müller Wiseman Milk Group members who are not aligned to supermarket groups, which have their own pricing arrangements.

It has also stressed its intention to continue to operate in full compliance with the spirit and intent of the dairy Voluntary Code of Practice.

Farmers who choose to supply the company would always get a full month’s notice of any change in their farm-gate milk price, said Müller. They also had the flexibility to move elsewhere after three months’ notice should they wish to do so.

Praised decision

Roddy Catto, chairman of the Müller Wiseman Milk Group (MWMG), which represents the 1,200 farmers who supply the company, praised its decision to hold off on price cuts.

“This is good news and reflective of Müller’s intention to do what it can against a backdrop of falling milk prices in the UK and around the world, to ensure that MWMG farmers are receiving a standard milk price which is significantly ahead of many others available in the UK.

“We will continue to work closely with the team at Müller to ensure that the concerns which members have about the current global supply and demand imbalance and its impact on their businesses, continue to be heard loud and clear.”

On January 5, First Milk followed Arla in announcing milk price cuts​, effective from the beginning of next month.

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