The UK’s Dairy Crest Group has said it has been informed by supermarket group Asda that its arrangement to supply fresh milk to Asda is to be ended later this year.

Dairy Crest said it is the smallest of Asda’s current fresh milk suppliers with turnover for the year ended 31 March 2004 of approximately £20m (US$36.4m).

“Whilst the loss of this volume is disappointing, Dairy Crest has recently been successful in winning volumes with other retailers and, despite this loss, it expects growth in its total retail fresh milk volumes in the current financial year,” Dairy Crest said.

Yesterday Robert Wiseman Dairies announced that it too had been given notice by Asda that its supply contract was to be ended, following a decision by Asda to source its milk from only one supplier. Wiseman’s contract with Asda was worth around £70m in turnover for the 53-week period to 3 April 2004. 

Meanwhile, Arla Foods announced that it had been awarded a contract for the supply of fresh milk to Asda, beginning in the final quarter of 2004.