Arla's milk price for April 2021 will increase to 31.43 pence per litre as the market outlook looks 'stable' with 'potential for further development'.
Arla Foods' on-account prices for conventional and organic milk will increase by 1.5 euro cents per kilo - equivalent to 1.40 pence per litre- from 1 April 2021.
This takes the co-operative's conventional milk price to 31.43 pence and organic milk to 39.79 per litre for farmers.
This month the on account price is also impacted positively by 0.04 pence per litre by the quarterly currency exchange rate adjustment.
Arla Foods amba board director, Arthur Fearnall, said there had been a significant increase in commodity market prices across all categories in the last month.
"Strong Chinese demand for WMP has driven global powder prices, with lower milk production in Europe increasing butter and cream prices here.
"As a result, cheese buyers have had to increase their prices to secure their supply.
"The current outlook is stable, with the potential for further positive development.”