The Müller-Wiseman group will boost its standard farmgate milk price to 29p per litre from 15 October.
The 2.57ppl hike – up from 26.43ppl – represents the single biggest increase in the history of Müller UK and Robert Wiseman Dairies.
The new price will apply to approximately 300 non-aligned Müller and Wiseman farmers who are not on supermarket supply contracts.
It follows high-profile protests by dairy farmers associated with all major processors staged against low farmgate milk prices and threatened price cuts over the summer.
Milk procurement director Pete Nicholson said it was vital Müller-Wiseman’s customers supported the increase, adding the group “was working to this end and confident that this will be secured”.
He added Müller had ambitious plans for the UK. “This presents real opportunities for dairy farmers who currently supply the group, and those who don’t but may be considering whether their current buyer is right for them in the long term.”
Roddy Catto of the Wiseman Milk Partnership said the increase would not come into effect as quickly as farmers had hoped but nevertheless welcomed “the hard work the company has put in over the past few months to restore trust” among farmers.
Wiseman recently announced the launch of its Wisemilk Initiative, which aims to find new ways of determining farmgate milk prices. It will use the proposed voluntary code of practice on contracts as a framework.
“We look forward to getting on and finalising the Wisemilk Initiative with the company and along with this clear and transparent price we firmly believe better days lie ahead for the suppliers to the Müller-Wiseman Group,” Catto added.
Earlier this week, Dairy Crest announced it was “confident” it would be able to deliver higher milk prices for its farmers this autumn.