Robert Wiseman has won back its full contract to supply Netto following a supplier review by the chain.
Wiseman lost two-thirds of its Netto business during pricing talks last October, with the retailer switching to Payne's Dairies.
However Wiseman is believed to have won back the 25 million-litre-a-year contract, which includes fresh liquid milk products, on quality and service grounds rather than price.
The processor also announced this week it had won a contract to supply Martin McColl c-stores nationwide with a 10-million-litre-a-year contract.
Robert Wiseman's sales for the first three months of the new financial year were about 2% ahead of the same period last year, the company reported.
Wiseman is building an £80m dairy at Bridgwater, which is regarded as one of the most environmentally advanced dairies in the world. One industry source suggested Netto was keen to tap into the new facility's environmental credentials.