Asda has notified Robert Wiseman Dairies and Dairy Crest that it intends to terminate their milk supply contracts.

Robert Wiseman's contract was worth £70m in the 53 weeks to April 3 2004, while Dairy Crest reported its contract was worth £20m in the year to March 31.

The move follows Asda’s decision to source milk from a single supplier and comes after Robert Wiseman clinched a deal to supply 44 Tesco stores in south east England.

In a statement, Dairy Crest said it was disappointed, but added that contracts with other retailers would offset any losses and ensure growth in the current financial year.

Robert Wiseman, md of Robert Wiseman Dairies, said: “This is obviously a major disappointment given the long term relationship we have had with Asda. We will attempt to persuade them not to follow this course, but we have to accept that at this stage we are unlikely to be successful.”