UK co-op tells farmers its financial woes are over

Britain’s largest dairy co-op, First Milk, has told its 1,200 milk suppliers that the financial crisis which recently caused a £10m (€13.3m) delay in payments is now over.

First Milk chairman and Conservative MP Jim Paice said falling prices had led to the firm posting a £12.1m loss in the six months to September 30. He said the company is expecting further volatility this year.

The group pays its farmers around 21p (28c) per litre for milk, but industry prices were as high as 35p (46.5c) per litre per last year.

First Milk said butter powder prices have fallen by 21p per litre over the last year, while mild cheddar and curd prices slumped by up to 40% in the same period.

First Milk has told its farmers it would also hike its milk levy for members from 0.5p (0.6c) per litre to 2p (2.7c) per litre until August. But the company said these measures meant First Milk will not have to come back to its members for cash.

Mr Paice said: “Barring something completely out of the ordinary, I am absolutely certain this puts us right and I will not be coming back to you again for more money. Every litre of milk that you either have produced, or will produce will be paid for.”