First Milk has confirmed it will cut its milk price by 3.6p per litre from January, taking the standard manufacturing litre to 32.25ppl including the member premium, as increasing global milk volumes continue to drag down returns across the dairy sector.
The co-operative said the move reflects ongoing market pressures, with UK and worldwide production hitting record levels and no sign of the imbalance between supply and demand easing.
Farmer director and vice-chairman Mike Smith acknowledged the impact of the decision on members. “This change reflects the continuing challenges in the market,” he said. “UK and global milk production remain at record levels, and there is still no sign of improvement in the supply/demand imbalance.”
He added that while the business continues to perform well operationally, weaker market returns have forced the price reduction. “We fully appreciate how disappointing this news is, particularly given the speed and severity of the downturn in the market cycle,” he said.
Smith stressed that the co-op remains committed to “maximising the value of our members' milk and driving efficiencies within our operations to improve future returns”.
First Milk is not alone. Two of the UK’s other major milk buyers, Arla and Müller, have also announced cuts as soaring global milk volumes continue to push markets downward and squeeze margins for producers.
From 1 December, Arla’s headline price for conventional milk will fall by 3.50ppl to 39.21ppl, although its organic price will remain unchanged at 57.95ppl.
Farmers meeting the terms of the Müller Advantage programme are set to receive 38.5ppl from 1 January 2026 — a cut of 1.5ppl.
