Dairy industry strikes milk deal

Dairy farmers and food processors have struck a preliminary deal which should help end the bitter stalemate over milk prices.

The two sides met at the Royal Welsh Show to agree a 'code of practice' which the National Farmers' Union (NFU) said offered 'hope' for the future.

The deal follows protests in which some 2,500 farmers decried cuts to the price paid by processors for milk, which they claim are forcing them to the edge of bankruptcy.

Among processors that have reduced the amount they will pay is Dairy Crest, which is cutting the price by 1.65 pence per litre, following an earlier cut of 2p in May.

Others include Robert Wiseman Dairies and First Milk, cutting the price by 1.7 pence per litre and Arla Foods UK, which implemented a 2p cut.

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However, the new code agreed yesterday aims to give farmers more freedom to leave processors who reduce the price of milk.

It stipulates that dairy farmers must receive at least 30 days' notice of a price change and retrospective price adjustments are no longer acceptable.

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Speaking after the deal was announced Mr Paice said: 'I welcome the commitment all sides have shown to reaching an agreement. The government will continue to work with all parts of the industry to secure its long-term future.'

Finer details will be finalised by the end of August. See tomorrow's paper for the full story.

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