Asda to increase price it pays for milk in bid to help farmers

Asda has announced that it is increasing the price it pays its milk supplier to "a level that will assist" farmers.

It comes two days after farmers had not ruled out the possibility of continued protests against other supermarkets as Morrisons announced the premium from a new milk brand will go directly to the dairy industry.

Asda will commit to paying 28p per litre for 100% of its liquid milk volume throughout its entire range.

A spokesman for the supermarket said: "Today, we have confirmed to our milk supplier, Arla, that we are increasing the price we pay per litre from Monday to a level that will assist our farmers during the current crisis.

"Asda's origins are in dairy farming which is why we are acting in the best interests of our farmers and our customers by increasing the price we pay, introducing the Farmer's Marque label and not passing on any of the costs to customers - our retail price stays the same."

The National Farmers Union (NFU) president, Meurig Raymond, said: "The NFU has been lobbying tirelessly for Asda to recognise the plight of the dairy industry so we are pleased that Asda has moved to support farmers in their hour of need.

"It is clear from Asda that this commitment is to support the UK dairy industry at a time of crisis.

"It is now important that Arla ensures this is delivered to British farmers on the ground, with immediate effect.

"This decision recognises that our dairy farmers need a fair price so consumers can ensure they have access to British dairy products now and in the future."

Bradford-based chain Morrisons had been one of the main targets for frustrated farmers who have stripped milk from the shelves before dumping it or giving it away for free.

Its new product will be launched in October and will be sold at a 10p per litre premium to the standard Morrisons price.

On Tuesday, David Handley, of Farmers For Action, said that although direct action would no longer be taken against Morrisons, it would be maintained against other supermarkets.

Mr Handley has helped orchestrate eye-catching protests which have seen cows invading supermarket dairy aisles up and down the country, and said Morrisons' ''small step'' was welcome, but protests would continue.

He added: ''You will see activity continuing and we'll try and put a few new twists in it.

''We may even take an elephant to a supermarket, but we haven't worked out yet where we're going to get that from.

''We'll need to find a very big wheelbarrow to follow it around as well.''

Leaders from the crisis-hit industry met Morrisons bosses in an attempt to tackle falling milk prices which, the NFU says, will lead to dairy farmers being forced to leave the industry in the next few weeks as they struggle to pay bills and face rising debts.

The NFU and Tenant Farmers Association called for other retailers to step forward, saying the industry was in an ''unsustainable'' position without change.

The four main farming unions, the NFU, the NFU Cymru, NFU Scotland and the Ulster Farmers Union, held an emergency summit in London on Monday to develop an action plan to tackle falling milk, lamb and arable prices.

There have been days of protests by farmers including milk trolley challenges, blockades at distribution centres and even bringing cattle into supermarkets.

Farmers estimate that it costs between 30 and 32p to produce a litre of milk, but the average price paid across the UK is 23.66p - following a drop of 25% in a year.

Tesco and Sainsburys have so far ruled out a similar move to Morrisons, saying that they pay a fair price based on the cost of production.