Arla Foods is raising its milk price to producers by a further half a eurocent per kilo from March 1.

When this increase to the on-account price is applied to the UK standard litre, it equates to an upward movement of 0.38ppl, taking the liquid price to 27.45ppl and the manufacturing price to 28.55ppl.

Commenting on the move, Arla Foods amba board director Jonathan Ovens said: “This is our seventh consecutive price increase and we are the first major dairy company in the UK to increase our price for March. I’m confident that this will be well received by our farmer owners.

“Milk production in the EU is picking up in line with seasonal trends, although it is still significantly below 2016 volume," he added.

Arla also released its group 2016 results, with overall revenue in the UK down from €2.5 billion in 2015 to €2.2 billion in 2016, a drop which the company blamed on lower global market prices and unfavourable exchange rates.

On the plus side, growth in its branded product portfolio enabled the UK operation to play a 'positive role' in the group's performance. Increased sales of Arla branded milk added £95m to the category, with successful launches of the award-winning B.O.B, Arla Farmers Milk, Arla Organic Farm Milk and Arla Cravendale.

In addition, Morrisons Milk for Farmers, launched in 2015, accounting for around 15% of sales within the categories that it competes in

Arla's Lactofree product range also enjoyed another year of double digit growth, up by 18%, following a 23% improvement in 2015. Similarly, the yogurt category, which the business first entered in 2015, has more than doubled year on year, helped by the success of Arla Skyr and Arla Protein.

Managing director Tomas Pietrangeli said: “In a year of continuing changes in the grocery market as well as political uncertainty, we were able to deliver a strong set of results by driving growth in the UK through our portfolio of popular products, and delivering efficiencies and cost savings in our supply chain.

“Despite these exciting developments we are, however, conscious of the longer-term context and potential impact of Brexit. That’s why we’re working closely with the wider food and farming industry, and with government, to try and maximise opportunities of Brexit, whilst mitigating potential risks."