A LEADING buyer of Cumbrian milk has announced a reduction in its price per litre.

Meadow Foods has announced its milk price will fall by 1.25 pence per litre (ppl) from January 1.

The decline will take Meadow's standard A litre milk price to 29.75ppl. The change will apply to the flat rate element on the price schedule.

Mike Gorton, who sits on the NFU's dairy board for the north west, said: "This is a big blow. It is absolutely all round bad news for everybody.

"A lot of farmers will see the bad weather coming, and hear about this decline in milk prices, and think 'that's another nail in the coffin'.

"They say they are better prepared for future downturns; well let's hope there is a future for the farmers that supply them.

"Farmers have not had the chance to recover from the last time prices went down. This has come just as single farm payments have gone in.

"Lots of farms were hoping to pay off long overdue bills with those payments, and now all the money will be sucked up by the milk prices going down."

Meadow Foods said milk volumes were now running at high levels for the time of year, putting negative pressure on the market. This comes following the strong performance of the dairy markets throughout the summer.

Mark Chantler, chief executive at Meadow Foods, said: "We regret that the sudden and marked downturn in milk prices have required us to move our price to reflect these market conditions.

"We have however been working to ensure that we are now far better placed to manage a downturn, focusing on developing our sales to achieve more products sold into premium contracts.

"This should help reduce some of the effects of market volatility, however we will continue to monitor the situation very closely going into the New Year."

In November, Meadow Foods announced an increase in its price per litre. This followed an earlier increase announce in August of the same year.

Meadow Foods is the UK’s largest independently owned dairy group and leading supplier of milk based dairy ingredients to the food industry.

It currently handles more than 500 million litres of milk each year direct from over 550 farmer suppliers from across the North of England, Midlands and North & West Wales.