Price hope for dairy farmers in merger

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ABOUT 1,600 British farmers are to become part of a European mega-business which could have a big influence on the dairy market.

Arla Foods Amba, a Northern European co-op with UK headquarters in Leeds, and Milk Link, a British co-op based in Bristol, have started moves towards a merger which means that 12,400 Scandinavian, German and British farmers will become partners in an organisation with influence in most of Europe – and which will be easily the biggest player in its sector in the UK.

Milk Link is bigger in cheese and Arla in liquid milk and they mainly serve different regions so the businesses are expected to complement each other without any factory closures or cutbacks.

Peter Lauritzen, the chief executive of Arla Foods UK, and Neil Kennedy, chief executive of Milk Link, said they expected farmers to benefit from their combined clout.

European farmers have been getting better prices than the British for some time because most of them sell to big co-ops which fight their corner.

Arla generally pays a little better for milk than most UK buyers and Milk Link’s farmers can expect equalisation to benefit them.

The National Farmers Union has strongly endorsed the merger.

Its dairy board chairman, Mansel Raymond, said: “UK farmers have looked enviously at European dairy co-operatives which have used their scale to command market-leading prices. This merger puts Milk Link members in a far stronger place.”

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