Milk prices 'back on track' says Arla chief executive

The group, one of Europe's biggest dairy companies, reported a loss of £300m in the UK for last year
The group, one of Europe's biggest dairy companies, reported a loss of £300m in the UK for last year

A rising supply of milk on world markets is likely to limit further gains in prices that have increased nearly 50 percent since a slump last year, Arla Foods have said.

The group, one of Europe's biggest dairy companies, reported a loss of £300m in the UK for last year owing to lower global market prices and unfavourable exchange rates.

A spokesman for the company said its UK businesses were not immune to challenges facing the global dairy industry, but growth from its branded portfolio enabled the UK to play a 'positive role' in the group's performance.

The co-operative, headquartered in Denmark, is Britain's largest and the world's seventh-largest dairy company in terms of turnover.

It said it emerged stronger from the crisis year of 2016 which saw highly volatile milk prices.

Milk prices 'back on track'

Tomas Pietrangeli, the managing director, Arla Foods UK, said: "In a year of continuing changes in the grocery market as well as political uncertainty, we were able to deliver a strong set of results by driving growth in the UK through our portfolio of popular products, and delivering efficiencies and cost savings in our supply chain.

"Despite these exciting developments we are, however, conscious of the longer-term context and potential impact of Brexit.

"That’s why we’re working closely with the wider food and farming industry, and with Government, to try and maximise opportunities of Brexit, whilst mitigating potential risks."

Chief Executive Peder Tuborgh told Reuters that milk prices are 'back on track.'

"The price level we're now seeing on the big markets is flattening out. I think we should be happy, if we can keep prices at the current level.

"Milk prices are currently at a level that is sustainable for the whole business, including our farmers," he said.