Sodiaal said deal with French retailers co-operative Systeme U offers a "fair compensation" deal for milk producers

Sodiaal said deal with French retailers' co-operative Systeme U offers a "fair compensation" deal for milk producers

French dairy co-operative Sodiaal and national retailers' co-operative Systeme U have signed a partnership agreement that offers a "fair compensation" deal for milk producers.

The cooperatives said the deal is designed to address "difficulties" that the dairy industry has faced over the past 18 months.

Under the terms of the partnership, signed by Sodiaal through its subsidiaries Candia and Orlait, farmers will be paid a premium for milk provided specifically for products that are certified by the country's Bleu-Blanc-Coeur healthy farming association. Sodiaal said the move will ensure consumers have continued supplies of milk that is rich in omega 3 from animal feed.

The partnership will also guarantee payments that reflect a "supportive approach to production" for 100% of UHT milk bottled under the "U" brand, the co-operatives said.

The Bleu-Blanc-Coeur association, founded in 2000, is recognised by the French ministries of health, agriculture and environment for its support of "nutritional and environmental" farming activities. There are currently more than 1,000 products produced under the brand across France and through international partner countries.

Sodiaal describes itself as Europe's third-largest dairy co-operative and the world's fifth largest with 4.8bn litres of milk collected. The co-operative said earlier this year that it planned to increase its organic dairy collection resources by about 100 million litres of milk by 2020.

Sodiaal members include more than 200 organic farms with a dairy collection that approaches 50 million litres, the co-operative said.