Liquid Milk Price
Dairy Crest has confirmed that it will hold the November milk price for its farmers on standard Liquid contracts. This has been agreed with DCD.
The average price paid to Dairy Crest’s non-aligned Liquid farmers is currently 23.5 ppl. This is a weighted average of Dairy Crest’s standard Liquid milk price, 21.69* ppl, and Dairy Crest’s Formula contract, which for October is calculated at 27.27** ppl.
Liquid Supplementary Milk Payment
Dairy Crest is also providing additional details of the payment of financial support for farmers announced by two of its retail customers, Morrisons and Lidl. Dairy Crest has committed to DCD that it will pass all monies received from retailers through to farmers. This will be distributed through a farmer support payment, supplementary to the price paid for raw milk.
The supplementary payment will be calculated based on the actual volume of processed milk purchased by Morrisons and Lidl and the actual volume of raw milk purchased by Dairy Crest for the relevant month. It is anticipated that the first supplement will be paid for milk supplied during October. Based on current forecasts, the first supplement for October is estimated at 0.39 ppl. The November supplement is estimated at 0.65 ppl.
Mike Sheldon, Managing Director of Dairy Crest’s Dairies business commented:
“Dairy Crest recognises the challenges facing our farmers and we have worked hard to deliver price stability in what remains an extremely volatile and tough environment for us all in the dairy sector."
“I am pleased to announce further details regarding retailer support for dairy farmers. This is positive news for farmers who are facing a particularly difficult winter.”
Davidstow Milk Price
Dairy Crest is also announcing that following 8 months of price stability - including an increase in August - it is adjusting the Davidstow milk price to reflect market conditions. A reduction of 1.5 ppl will be applied from 1 November 2015. The Davidstow milk price, at 24.92* ppl, will continue to be one of the highest milk prices paid for a manufacturing contract. This change has also been agreed with DCD.
Mr Sheldon commented, “Dairy Crest is proud of the world-class supply chain for our Davidstow cheese creamery. The Davidstow farmers are a vital part in this supply chain. Our Davidstow milk contract has consistently delivered a premium to supplying farmers. Although I know farmers will be disappointed with this reduction, we remain confident that the contract is extremely competitive and has delivered a prolonged period of stability this year. The £65 million we are investing in the factory to produce infant formula ingredients will also bring extra security to these farmers.”