Peter Crosskey Dairy Crest's acquisition of most of Unigate's dairy business will make it the largest player in the industry, buying nearly a quarter of milk produced in England and Wales. The size of the new grouping leaves the words monopoly' and inquiry' never far from producers' thoughts. The timing won't be wasted on those involved in raw milk negotiations, either. There are few indications of pricing levels at present, although a lot of contracts should be in place by now. All three regional producer co-ops appear to be holding a united front, talking tough and not countenancing spot trading during the summer. This may be a resolute tactic to extract firm volume commitments from customers, but given the gap between buying raw milk and selling finished cheese, for instance, it is unlikely to be well received among processors. With two or three months to run before the merger is finalised, Dairy Crest will be content to see how the new sellers operate. "I don't think the milk buying policy will change at all," chief executive John Houliston told The Grocer. "We will ensure we continue to purchase our milk on the most competitive terms we can ­ and we will be the largest purchaser of raw milk in England and Wales. "That is the only way we can remain a competitive dairy company and reward our shareholders accordingly." Access to Unigate milk producers, who supply 60% of Unigate needs, will not automatically lift the proportion of direct contract raw milk. "Further down the track we will decide what will be the best combination in the circumstances that follow the acquisition and the break up of Milk Marque," said Houliston. Dairy Crest currently buys about 45% of its needs under direct contract. "Although there is a gap in the proportion of direct buying between the two companies, it is not a huge gap." {{PROVISIONS }}

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