Arla's milk price for September 2021 will be reduced by 0.90p per litre amid rising inflation across its global supply chain.
The announcement takes the co-operative's conventional milk price to 32.30p per litre and organic milk to 40.66p per litre for farmers.
Arla Foods amba board director, Arthur Fearnall, said the effect of continued inflation impacted Arla’s cost base leading to a 'corrective reduction of the milk price'.
"Besides this the commodity markets are overall stable," Mr Fearnall explained.
"European milk intake is still very limited, in June we will probably end with a small growth, while July figures are indicating a small decline.
"The outlook is stable after the September decrease.”
Ash Amirahmadi, managing director for Arla Foods UK, said that the reduction came after recent increases and a period of stability in milk price over the last two years.
But he added: "It is not ideal for our owners who are themselves experiencing inflationary costs on farm.
"However, right now as a business we are facing increased pressure of inflation across our global supply chain.
"As a cooperative, ensuring a sustainable future for dairy and the most value for our farmer owners for the milk they produce is crucial to our commercial decisions."
