THE farming industry has expressed its disappointment after another price cut hit dairy suppliers at the same time as products like butter are trading at record highs.

NFU Cymru said that Arla’s recent 0.4ppl price cut is a surprising move when the Arla Amba price remains unchanged.

The cut follows on the heels of dairy co-operative First Milk who reduced May milk prices to members by between 0.10ppl and 0.35ppl after a series of rises in milk prices to producers,

The Midlands & East Wales milk pool showed a drop of 0.10ppl to 26.15p in A prices, while Haverfordwest dropped 0.35 to 27.53.

NFU Cymru dairy board chairman Aled Jones said: “Only last month we applauded the UK Arla Farmers board in supporting Welsh and UK members by removing the impact of the EU milk price reduction of one eurocent per kilogram. I am shocked that they have sought to rebalance the Welsh and UK purse so soon.

“At the Dairy Industry Newsletter conference last week, attendees were told that EU butter markers are exceptionally good with future prices up to €5400 and €5500 for June and July. At the current exchange rate that’s around £4720 so I can clearly see why farmers are asking what’s going on.

“Latest figures from AHDB show that while both AMPE1 and MCVE2 indicators have weakened slightly, the cream income to the processor continues to rise3 and now delivering on average 10.1ppl back to the processor.

“I’d really like to know who is benefitting from this high cream and butter price because it clearly isn’t dairy farmers. We’ve had spells of dry weather which has impacted on grass growth – and ultimately volumes – and with the GDT market continuing to strengthen; it makes no sense that we are now seeing milk price reductions.

"This isn’t the first one with Dairy Crest announcing last month that there would be a 1ppl cut for June and a further 1ppl cut for July with County Milk Products even backdating milk price cuts.

“While Arla mentions that markets are stabilising and we’re seeing more and more positive signs at the trading end – I would hope that this would be reflected in the farmgate price.

“The need for a more transparent market could not be more obvious than now. With such an encouraging lift in prices at the trading end, there is a clear expectation for this to be translated through the supply chain.

"If we were to have a more transparent market this would build trust throughout the supply chain. This makes it even more relevant that we continue our call for better market transparency through mandatory dairy price and volume reporting – something that we are lobbying Government for as we leave the EU.”