The proposed merger of co-ops Scottish Milk and Axis is good news for dairy farmers and for the dairy industry as a whole, says the NFU.

NFU Milk and Dairy Produce Chairman Terrig Morgan said: "We have been saying for a long time that in order to be successful, dairy farmers and their milk selling groups must aim to develop and grow to the benefit of their members.

"The announcement that Scottish Milk and Axis are to merge is a vindication of that view.

"It is a recognition that dairy farmers' milk selling groups are operating in a commercial world and are aware of the market forces which determine the price of milk."

NFU Deputy President Tim Bennett said: "The dairy industry is in the middle of a period of rapid change and the whole industry must grasp the opportunities that this affords.

"This latest announcement will bring significant benefits to the farmer members of the two groups but also for the rest of the dairy industry.

"The NFU will do all it can to maintain the impetus for change which brings commercial advantage to dairy farmers."