Morrisons and Asda have sparked a milk price war despite widespread protests from farmers over the price they are paid for milk.
Morrisons undercut Asda offering four-pint bottles of semi-skimmed milk for 98p the day after Asda cut its price for four pints from £1.18 to £1. Morrisons took out national press advertising to market the price.
Pressure has been growing on the major grocers to show a commitment to UK farmers following protests in Westminster over the price they are paid by milk processors who pass on cuts from the grocers.
Last week Asda increased its premium paid per little (PPL) by 2p to 3ppl while Morrisons increased its premium from 1p to 6p but protest group Farmers for Action stressed this did not bring their income above the cost of production.
Aldi said today that it will directly pay its farmers an extra 2p per litre from August 1.
The cost of production is estimated at 30p a litre by the National Farmers’ Union.
Milk giant Robert Wiseman is due to make a 1.7p a litre cut in August, echoing moves by Dairy Crest, Arla and First Milk since April.