A 'stable' outlook for the New Year, has prompted milk processor, Arla to increase its prices for conventional and organic milk.

This means the UK manufacturing price for conventional and organic milk will be 37.58ppl and 44.61ppl respectively.

Paul Savage, agriculture director for Arla UK said: “Both conventional and organic markets are coming back to growth and our retail branded sales continue to improve.

"With a stable outlook, this latest and significant increase should give confidence to our farmer owners as we begin the start of a new year.”

Arla Foods amba board director, Arthur Fearnall said the news would be 'a good start to the new year' for the co-op's UK and European suppliers.

"Retail sales continue to pick up after the turnaround in quarter three in 2023," he said, adding that global commodity prices continued to recover as well.

However, he said they were slightly weakened after seasonal demands were fulfilled.

Further afield, in central Europe, farmers with Arla contracts are seeing higher increases in organic milk prices from January 1, 2024, rising 5€ cents per kg

Mr Fearnall said: "This increase for organic is driven by the transition of the certification scheme to the organic association Naturland and following the increased profitability from retail positions. The outlook is stable.”

The increase also follows a third consecutive increase in the Global Dairy Trade (GDT) price index which rose by 1.2% at the first trading event in 2024. (See page 39 for more information).