Third price increase in three months for First Milk producers

THE PRICE for First Milk producers has been increased for the third month in a row.

The group announced that it will increase its September milk prices by up to 1.25ppl, with a further increase scheduled for October.

Chief executive Mike Gallagher admitted that while the increases are welcome, the cost of milk production is still yet to return to sustainable levels.

He said: ‘While it has been pleasing to announce these milk price increases over the past few months, we recognise that they do not yet return members to sustainable prices.

‘However, with future market prices for commodities forecast to be around the mid20s, members can be confident that as the market continues to rise in line with this forecast, so will our milk price. In addition, we will continue to deliver on our business performance supplement commitment.’

Chairman Clive Sharpe said: ‘I am pleased to report that for the third month running we will be increasing our milk price. With the market recovering and having exited our loss-making activities, returns are flowing directly through to our milk price.

‘In June we introduced a business performance supplement. This is the money that comes not from market changes – which now flows through directly – but from our own planned improvements such as removing loss making divisions, improving our commercial and quality performance and cutting our costs.

‘As well as increased cheese returns, we are now starting to see price movement from some of the major liquid processors, which directly benefit our balancing pools. There will be further price lifts for October and we will confirm the level of this during September once we get a full view on market changes.’

Mr Gallacher added the new vision for the group will be explained at a series of member meetings planned for late September/early October.