Müller has become the latest dairy processor to announce a milk price cut, with its standard milk price set to drop by 1.2 pence per litre from August.

Its new standard milk price for farmers will be 30.80ppl as of 3 August.

The reduction reflected the continuing challenging market conditions, with returns from cream and butter “significantly lower” since the end of 2013, the processor said.

However, Martin Armstrong, head of group milk supply for Müller UK & Ireland, stressed Müller continued to “believe the underlying and future prospects for British dairying are extremely positive”.

Müller’s milk price news comes after First Milk announced a reduction in its milk prices on Monday (30 June), citing volatile commodity markets: its liquid milk price will fall by 1.75ppl to 28.75ppl from 1 August, with its manufacturing price to reduce by 1.25ppl to 29.60ppl.

“While we cannot control global and European market prices, the board of First Milk is working hard to improve the situation and has reduced overheads considerably,” said chairman Jim Paice.

Last week, Arla Foods amba announced a reduction - from 7 July - of its global farmgate milk price for co-operative members by €1.50 cents per kg. When applied through Arla’s pricing mechanism, this will result in a reduction of 1.23ppl to Arla’s UK standard litre price, which will stand at 32.52ppl as of next week.

By contrast, Dairy Crest has announced it will hold its liquid and Davidstow manufacturing prices for August, with both staying at 31.2ppl and 33.2ppl respectively. The move demonstrated Dairy Crest’s “commitment to reduce milk price volatility whenever possible”, said group procurement director Mike Sheldon. “We have been consistent in our approach to milk pricing - aiming to deliver greater stability and transparency.”