Arla Foods amba increases its milk price for July

Arla Foods is raising its milk price to owners by two eurocents per kilogramme from 1 July. When the increase in the on-account price is applied to the UK standard manufacturing litre, the increase equates to an upward movement of 1.65 pence.

July also sees a new quarter’s (April to June) average exchange rate introduced to the pricing mechanism, however this money was used to support the milk price in May and June. In addition, the rebalancing of the UKAF cash flow will conclude this month with a further small deduction.

The net impact of the milk price increase and the currency and cash flow adjustments is a 1.44 pence per litre increase in the manufacturing standard litre, taking it to 29.17 pence.

Commenting on the decision to increase the price, Arla Foods amba board director, Jonathan Ovens, said: “This will be welcome news for our owners that we are reflecting current market returns from rising fat prices in our July milk price.

“The current market situation is characterised by strong demand and low stocks of fat, which is driving up prices for butter, cheese and other products containing fat. The market for protein is also firming, however at a low level.”

Ends

• Manufacturing price based on every other day collection, top quality, one million litres,4.2% butterfat, 3.4% protein

• Arla Foods is transitioning to a manufacturing schedule only with effect from 1 January 2018, where Arla farmers will be paid on constituents. For ease of comparison, the liquid price is 28.03 pence, based on 4% fat and 3.3% protein.

Source: MilkPrices.com

Arla Foods is a global dairy company and co-operative owned by 12,000 dairy farmers with circa 2,500 of whom are British.

Dating back to 1881, Arla’s purpose is to secure the highest value for its farmers’ milk, while creating opportunities for their growth. With production facilities in 11 countries and sales offices in a further 30, Arla is the world’s fifth largest dairy company and largest supplier of organic dairy products. Arla has a total of more than 18,000 colleagues and its products are sold under the well-known brands Arla®, Lurpak® and Castello® in more than 100 countries.

Arla Foods UK is the largest dairy company in the country and is home to leading dairy brands Anchor®, Arla Cravendale®, and Arla Lactofree® with a turnover of €2.2 billion. The UK is largest market within the Europe Zone, contributing 35% of the zone’s turnover and also comprises 25% of the Group revenue.

As well as being a leading supplier of fresh milk, number one in butter, spreads and cream, Arla is the UK’s largest cheese manufacturer. It has also built the world’s largest fresh milk facility located at Aylesbury that later this year will become the first net zero carbon site of its kind. The UK business has a team of approximately 3,500 colleagues located at its dairies, creameries, distribution centres and head office.