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July 23, 2012

UK: Morrisons to up milk payment

Morrisons is to increase what it pays to milk farmers, becoming the latest UK retailer to up its payment amid anger from suppliers.

By Dean Best

Morrisons is to increase what it pays to milk farmers, becoming the latest UK retailer to up its payment amid anger from suppliers.

The UK’s fourth-largest retailer said it would increase the premium it pays for milk and make an extra payment to farmers affected by the “extreme” recent weather in the country.

From 1 August, Morrisons will pay an additional 2p per litre and an extra payment equivalent to 3p a litre from 1 August.

Morrisons has been one of the UK retailers that has faced criticism from farmers for the price it pays for its milk.

Farmers have held protests outside Morrisons stores and at a distribution site in the south-west of England.

The protests, which have also targeted rival retailer Asda and processors including Robert Wiseman Dairies, were prompted by a series of price cuts by UK dairy manufacturers.

Morrisons said the extra payments will last until the end of October when they will be “reviewed”.

Commercial director Richard Hodgson said: “We recognise the exceptional pressure on farmers currently and continue to aim to support all farmers not just those that have dedicated contracts. The recent announcements by our processors will reduce the payment to farmers for the milk we sell and therefore we are announcing payments that negate their impact.”

The retailer said it has been “looking at a long-term solution to volatile milk prices” and would “accelerate” the programme.

Peter Kendall, president of the National Farmers Union, welcomed Morrisons’ move. “We’re really pleased to see Morrisons response to the calls from a coalition of farming groups to reverse the announced price reductions and address the exceptional costs dairy farmers are now facing. We need a long-term solution that addresses the need for a sustainable raw milk supply into the future. It’s now critical that other retailers and major buyers of milk respond to the responsible steps Morrisons is taking.”

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