Arla Foods has cut its its on-account milk price for April by 0.75p/l, the equivalent of 0.94c/L when converted to euro.

The price reduction will come into effect from April 1.

According to Arla, April also sees a new quarter’s (January – March) average exchange rate being introduced to the pricing mechanism.

This has a 0.19p/L negative impact on the milk price, it said.

Arla said that this latest reduction, coupled with the impact of exchange rates, reduces the UK standard litre price for conventional milk down by 0.94p taking it to 20.87p/L (26.41c/L).

Arla UK held its milk price for March at 21.81p/L (27.62c/L).

The continued growth in milk production across Europe continues to have an impact on the imbalance between conventional milk supply and demand. This is continuing to put pressure on commodity and cheese markets which is having a knock-on effect across other markets.

Arla Foods amba Farmer Board Director, Jonathan Ovens, said that the milk price is definitely not at a level that anyone wants it to be, but the business is continuing to work hard to mitigate the negative effects of the hard-pressed global dairy market.

“We believe Arla has the right strategy to get through this, although the current situation is extreme for both Arla and everyone else in the global dairy market.”

Arla Foods is a global dairy company and co-operative owned by 12,700 dairy farmers with circa 2,700 of whom are British.