Muller has confirmed that it will reduce its standard milk price by 0.85p per litre (ppl) from May 1st due to the continuing extreme market volatility couple with high levels of global milk supply.

The move takes the price paid to former Dairy Crest Direct members - now Muller Direct Milk suppliers - down to 18.45ppl. That will be the first time since 2007 that they have been paid less than 19ppl and represents a 43 per cent cut from the market peak two years ago.

Meanwhile the price cut takes Muller Milk Group members (ex Muller Wiseman Milk Group) down to 19.15ppl and Muller Direct Milk Formula (latest forecast) down to 24.73ppl.

Lyndsay Chapman, Agricultural Director of Muller Milk & Ingredients said: "Market returns continue to be severely depressed creating an increasingly difficult trading environment as we approach the peak period of milk production. As a result we unfortunately have to reflect this through a further reduction in our milk prices for May."

NFU Scotland's Milk policy Manager, George Jamieson, said: "This latest cut by Muller means that more than half of Scotland's hard-pressed dairy farmers are entering the spring on a milk price that is below 20ppl - a staggeringly poor return for the work and effort that goes into producing fresh milk and dairy produce, further undermining confidence in the future of the sector in Scotland."

While Muller do not manufacture cheese, Mr Jamieson went on to highlight the role retailers could play saying: "With wholesale prices for mild cheese less than £2000/tonne, but that same mild cheddar on shop shelves at a price equivalent of £5800/tonne, the mark up being made by retailers must be addressed by either giving the public a better deal on their cheese, or better sharing the margins with those producing the milk."

Market round-up

Wallets Marts sold 802 prime hoggs in Castle Douglas on Tuesday to a top of £96 per head and 243.2p per kg to average 181.7p.

Messrs Craig Wilson Ltd sold 13 prime heifers at Ayr on Tuesday to a top of £1187.20 per head and 224p per kg to average £1088.41 and 205.5p, while 3 prime bullocks peaked at £1141.38 and 217p to level at £1116.61 and 204.3p.

In the rough ring 23 beef cows averaged 129.6p and 122 dairy cattle levelled at 87.3p. Eight bulls averaged 118.8p.

A small show of 7 dairy cattle sold to £1480 for a Holstein Heifer and averaged £1049.

The firm went on to sell 895 prime hoggs in Newton Stewart yesterday to a top of £97.50 and 211p to average 181.4p.