Milk and dairy ingredients supplier Meadow Foods has cancelled its planned milk price cut following “positive talks” with its customers.

The company, which was due to reduce its price by 1.87p per litre today (1 August) said it was still in the process of negotiating with some of its customers but felt it was nevertheless able to tell farmers the price cut would not be going ahead.

Executive chairman Simon Chantler said it was vital that industry talks continued to find an acceptable solution for all parts of the supply chain.

“Following what has been a very difficult couple of weeks for all concerned in the dairy industry, it still remains a critical time for the UK dairy industry as a whole, as we still have to find a solution for the longer term and parts of the market are yet to pass back money for the August cut,” he said. “Let us hope that the moves we have seen in the past few days are a turning point.”

Meadow supplies dairy ingredients such as cream, butter, condensed milk and chocolate crumb to food manufacturers, generating annual sales of £340m.

Its decision not to go ahead with the planned price cut comes after the country’s three largest liquid milk processors – Robert Wiseman Dairies, Arla Foods and Dairy Crest – all announced they would not implement previously planned price cuts on 1 August.

Arla has cancelled its planned 2ppl cut outright, while Dairy Crest has suspended its 1.65 ppl cut for two months and Wiseman suspended its 1.7ppl cut by one month.

Farmers had been ramping up protests against the cuts, which they said would mean some farmers would end of earning less than the cost of production for their milk, and extracted commitments from all major supermarkets to increase the price they pay for milk. Further protests aimed at reversing earlier price cuts are planned for the future.