French milk producers and dairy companies have reached an agreement on milk price cuts, bringing to an end a dispute which has seen deliveries stopped and production plants blocked over the past month.
 
"We're not jumping for joy at this deal but it represents a necessary compromise," a spokesperson for France's leading milk producers federation, the FNPL, told just-food today (2 December).
 
"Our initial position was not to accept any price cuts at all but the continuing deterioration in market conditions meant these were unavoidable. Nevertheless, the scale of the cuts is not as important as the dairy companies were proposing several weeks ago."
 
The agreement makes provision for price cuts for November and December 2008 and the first quarter of 2009. 

The deal will see cuts of EUR25 (US$31.7) per 1,000 litres for November and December - a drop of 7-8% - of EUR45 in January and February - a cut of 12% - and of EUR55 in March - down 15%.
 
At the outset, dairy companies had pushed for monthly cuts of between EUR40-60 in the final quarter of 2008 and EUR100-120 in the first quarter of next year, the FNPL spokesperson added.