Ex DFB producers take a cut from First Milk

The reduction, announced in a letter to the 400 or so that First Milk signed up on supply contracts, is blamed on challenging market conditions.

The letters says the milk from these producers is going either to Westbury Dairies or is being sold on the spot market.

“Prices for spot milk are currently weak and we are unable to continue paying out returns that are significantly more than we are recovering from the marketplace,” says the letter.

It points out that it was only in recognition of the circumstances surrounding Dairy Farmers of Britain’s move into receivership, that First Milk e decided to pay its standard litre price for June and July milk to those on supply contracts.

“Based on the returns we are securing from the marketplace, it is necessary to reduce your standard litre milk price to 18.65ppl from August 1, 2009. We will review this price on a month-by-month basis and commit to inform you should the price change prior to the end of the previous month.

“Ongoing we aim to utilise more of your milk in other markets and secure as much as possible on sales contracts, both of which will improve your milk price,” says the letter.

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