Dairy Crest suppliers will not have known whether to laugh or cry this week after the processor increased its cheese milk price by 0.4ppl from August but reduced its liquid milk price by 0.3ppl.
The increase came as a result of the recent retail price initiative on cheese. Dairy Crest has so far pledged to pay back 0.7ppl extra to farmers, and hopes to offer more from September.
The downturn in its liquid price was widely expected. The company has not been able to realise price increases in the middle ground, which includes the smaller retail chains, independents, the foodservice sector and contracts with the government. The move
prompted Farmers For Action to call on members to stage protests at Dairy Crest sites.
Arthur Reeves, Dairy Crest’s milk purchasing director, said: “We’ve held off from making this decision for a couple of months, fully aware of the delicate balance in the industry. However, there are a number of factors that we can no longer ignore. These include our need to be competitive in the liquid milk market and the fact that we have not been able to realise price increases on some of our middle-ground sales.”
Dairy Farmers of Britain, which purchased the ACC liquid milk business a year ago, is another dairy affected by middle-ground intransigence, since it sells a significant proportion of its volume into this sector. The co-op reduced its liquid price by 0.25p last week, a move that resulted in accusations from FFA, and some competitor dairy companies, that it was not pulling its weight on the retail price initiative.
DFB argued that by imposing an increase it would face losing business, particularly in the tough foodservice sector.
Chris Walkland
The increase came as a result of the recent retail price initiative on cheese. Dairy Crest has so far pledged to pay back 0.7ppl extra to farmers, and hopes to offer more from September.
The downturn in its liquid price was widely expected. The company has not been able to realise price increases in the middle ground, which includes the smaller retail chains, independents, the foodservice sector and contracts with the government. The move
prompted Farmers For Action to call on members to stage protests at Dairy Crest sites.
Arthur Reeves, Dairy Crest’s milk purchasing director, said: “We’ve held off from making this decision for a couple of months, fully aware of the delicate balance in the industry. However, there are a number of factors that we can no longer ignore. These include our need to be competitive in the liquid milk market and the fact that we have not been able to realise price increases on some of our middle-ground sales.”
Dairy Farmers of Britain, which purchased the ACC liquid milk business a year ago, is another dairy affected by middle-ground intransigence, since it sells a significant proportion of its volume into this sector. The co-op reduced its liquid price by 0.25p last week, a move that resulted in accusations from FFA, and some competitor dairy companies, that it was not pulling its weight on the retail price initiative.
DFB argued that by imposing an increase it would face losing business, particularly in the tough foodservice sector.
Chris Walkland
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