The previously acquiescent Arla Foods Milk Partnership has reacted angrily to the latest milk price cut by Arla Foods UK.
The leadership of the Arla direct supply group, which is headed by chairman Jonathan Ovens, had until last week stood shoulder to shoulder with the plc as it made a series of milk price cuts that angered many farmers.
But the 0.35ppl cut to AFMP members, announced on September 9 and effective from last Saturday, drew an angry reaction from Ovens and the rest of the AFMP board.
“It wasn’t the size of the reduction that we couldn’t agree to, it was the principle of a cut at all,” Ovens told The
Grocer. “We had to send a sign to Arla and the wider world that things have got to change.”
The division is significant because it is the first time Arla and AFMP have failed to agree on price movements. David Levick, a dairy analyst at consultancy Kite, which works with many Arla suppliers, said he was shocked at how strongly opposed to the drop the AFMP members were.
In a statement, Arla said it was “a follower, not a leader, in reducing milk prices”.
Referring to a cut made by Robert Wiseman Dairies at the end of last month, it added: “After the recent downward movement by a competitor, we could not be left disadvantaged in what is an extremely competitive market.”
The row will put strain on the relationship between Arla and AFMP, but it is likely to do Ovens’ stock no harm among farmers. Some AFMP members had previously complained that he was too close to the Arla management, with some even calling for his resignation.
After the latest cut, Arla’s price to AFMP members is 19.30ppl, with a 0.5ppl supplement for Asda Farmer Partners.
Chris Walkland
The leadership of the Arla direct supply group, which is headed by chairman Jonathan Ovens, had until last week stood shoulder to shoulder with the plc as it made a series of milk price cuts that angered many farmers.
But the 0.35ppl cut to AFMP members, announced on September 9 and effective from last Saturday, drew an angry reaction from Ovens and the rest of the AFMP board.
“It wasn’t the size of the reduction that we couldn’t agree to, it was the principle of a cut at all,” Ovens told The
Grocer. “We had to send a sign to Arla and the wider world that things have got to change.”
The division is significant because it is the first time Arla and AFMP have failed to agree on price movements. David Levick, a dairy analyst at consultancy Kite, which works with many Arla suppliers, said he was shocked at how strongly opposed to the drop the AFMP members were.
In a statement, Arla said it was “a follower, not a leader, in reducing milk prices”.
Referring to a cut made by Robert Wiseman Dairies at the end of last month, it added: “After the recent downward movement by a competitor, we could not be left disadvantaged in what is an extremely competitive market.”
The row will put strain on the relationship between Arla and AFMP, but it is likely to do Ovens’ stock no harm among farmers. Some AFMP members had previously complained that he was too close to the Arla management, with some even calling for his resignation.
After the latest cut, Arla’s price to AFMP members is 19.30ppl, with a 0.5ppl supplement for Asda Farmer Partners.
Chris Walkland
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