Dairy farmers supplying Müller are facing another squeeze on already stretched margins after the processor confirmed a further milk price cut, deepening concerns over the sustainability of production as prices fall below the cost of production.
From 1 February 2026, farmers meeting the conditions of the Müller Advantage programme will receive a farm gate milk price of 35.5p per litre, a reduction of 3ppl.
The cut follows an earlier reduction due to take effect from 1 January, when Müller Advantage suppliers are set to receive 38.5ppl, down 1.5ppl.
Richard Collins, agriculture director at Müller Milk & Ingredients, said the decision reflects ongoing market weakness. “There is still considerable pressure across dairy markets,” he said.
“Our daily milk collection volumes are still much higher than this time last year and we’re seeing further market price reductions. Supply and demand is continuing to be monitored closely.”
The announcement comes as many dairy farmers are already being paid less for their milk than it costs to produce, a situation that has deteriorated rapidly in recent weeks.
A surge in milk output in the UK and overseas has pushed markets lower at the same time as feed, energy and labour costs remain historically high, leaving businesses with little scope to absorb further losses.
Industry bodies have warned that falling prices are placing acute financial pressure on producers, with some farms being pushed to the brink and unions calling for urgent action from processors and retailers.
Müller’s move mirrors a wider pattern across the sector as rising global milk volumes continue to outweigh demand. First Milk confirmed it will cut its milk price by 3.6p per litre from January 2026, taking the standard manufacturing litre to 32.25ppl, including the member premium.
Other major buyers have also announced reductions. From December, Arla's headline price for conventional milk fell by 3.50ppl to 39.21ppl, although its organic price will remain unchanged at 57.95ppl. Together with Müller, these cuts underline the scale of downward pressure across dairy markets.
With further reductions now confirmed into early 2026, producers warn that sustained low prices risk undermining confidence, investment and future milk supply unless market conditions improve or greater support is delivered through the supply chain.
