Arla Foods amba is increasing its conventional milk price for July by two eurocents.
When applied to the UK manufacturing litre, alongside the positive impact of the quarterly currency smoothing mechanism, the total increase equates to 1.92 pence per litre from July 1, taking Arla’s standard litre price to 30.50 pence.
The increase has been possible again this month, in part due to the impact of the weather in the first half of the year which has, in turn, resulted in European milk volumes being lower than expected. This, coupled with strong demand particularly from Asia, has seen commodity market prices grow strongly in recent months. Strong supply in the organic markets continues to keep pressure on organic prices.
Commenting on Arla’s decision to increase its milk price, Arla Foods amba board director, Johnnie Russell, said: “I am confident this will be welcome news to our farmer owners, who have been experiencing challenging weather conditions, which have dampened milk volumes from farm. I am pleased to say that the overall outlook for the coming months remains positive.”