Tesco is calling on milk processors to pay dairy farmers at least 2p more a litre following a meeting with the National Farmers' Union.

Tesco boss Sir Terry Leahy met with NFU president Ben Gill to discuss the difficulties facing British dairy producers and milk prices.

Tesco director John Gildersleeve said: “Although we cannot determine the price paid to farmers, we are today calling on all milk processors to pay them at least 2p per litre more because of the need to sustain the UK dairy industry.”

He added: “We urge other retailers and manufacturers to examine their sourcing policy and do more to support the British dairy industry."

Gill has also met with Safeway to push for a better return for dairy farmers. He told Safeway chairman David Webster that if a fair price is not achieved for farmers there would be no credible British dairy farming industry.

Gill said: "That fair price must be achieved in the next three weeks in the lead-up to the next milk selling round on October 1. There is no luxury of time in this equation.”

Gill added that the NFU’s prime aim was not an increase in the retail price of milk rather a fairer share of the final value to pass back to milk producers.