The major supermarkets have all increased the in-store price of milk over the past week in a move that is expected to be followed by major c-store chains and independents.
A four-pint of semi-skimmed milk rose 10p to £1.44 last week in Asda, Tesco, Sainsbury's, Morrisons and Waitrose, The Grocer pricing data has revealed, with a one-pint bottle going up 2p. They are the first price rises on standard own-label milk since 11 September, when Asda and Tesco were the first to raise their prices from £1.15 to £1.34 for a four-pint.
Asda and Tesco were again first to raise their prices in an attempt to mitigate hikes on fuel, plastics, utilities, feed cost increases and other agricultural inputs.
The retail price of milk has now risen 12.7ppl over the past year, with farmgate costs up 8.1ppl over the same period, according to figures from DairyCo.
Asda said it expected farmers supplying it through Arla to receive 0.5ppl more.
But the move was only cautiously welcomed. "We can have little complaint if retailers choose to increase the shelf price of products to reflect the increased costs that they face," said National Farmers' Union Scotland milk committee chairman Willie Lamont. "However there is an onus on such companies to ensure all parts of the chain have the same opportunities to cover their increased costs of production."
The price rises came as European farmers went on strike demanding a greater share of the retail price. Farmers in Germany, Belgium, the Netherlands and other countries have been demonstrating and withholding large volumes of milk, raising fears shortages are looming.
In the UK such scenarios were unlikely, with progress by farmers more likely to be made through discussions with retailers over the true costs of production, said David Cotton, vice chairman of the Royal Association of British Dairy Farmers.