MILK PRODUCERS supplying Arla Foods with conventional or organic milk will see a farmgate increase of 0.5 euro cents per litre from March 2021.

In effect, this means that Arla’s conventional milk price will increase to 30.03 pence per litre, and organic milk increase to 38.39ppl, for the co-op's farmer owners.

Arla Foods amba board director, Arthur Fearnall, said: “Global milk production is mixed with Europe and Oceania experiencing limited growth and both North and South American markets continue to grow strongly, however, this growth appears to be having little impact on global demand or prices.

"Demand for commodity products remain strong, meaning that prices for all categories, whether cheese, powders or butter remain firm. Overall, demand continues to be stronger than expected and therefore market sentiment has remained positive. The current outlook remains stable with the potential for positive development.”

UK Agriculture director at Arla, Alice Swift, added: “This rise comes as farmers are becoming increasingly pressured by the rising on farm costs they are facing for purchased feed, straw and fertiliser on the back of what has been a long wet winter.

"As a cooperative, ensuring the most value for our farmer owners for the milk they produce is crucial to our commercial decisions, and will continue to be our priority.”