UK dairy group Dairy Crest is to raise the prices it pays to its milk suppliers on liquid milk and cheese contracts from October.
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The company announced the rises – to 25p per litre on milk and 24p on cheese – in its pre-close statement, announced today (26 September).
Dairy Crest said that remained in line with expectations, with growth from a number of key brands, a successful rollout of healthier products and positive progress at its international business, St Hubert.
Dairy Crest, which will publish its results for the six months to 30 September on 8 November, said changes that had taken place in the dairy industry since the beginning of the year were “unprecedented”.
The company said the world markets for skimmed milk powder and bulk butter had been particularly strong which, coupled with lower milk production levels due to the adverse weather over the summer, had caused considerable upward pressure on raw milk prices, leading to price rises across most dairy categories.
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By GlobalDataThe company added that to reflect its higher input costs it had agreed price increases with its customers in cheese, fresh milk, potted cream and packet butter.
“The UK dairy market has seen unprecedented changes in recent months,” said CEO Mark Allen. “Against this market background the group overall is trading in line with our expectations. We have been successful in achieving higher prices across a range of products, enabling us in turn to deliver higher prices to our direct milk suppliers.”
