Tesco Facing Industry Opposition Over Milk Prices in UK

Farmers worrying that they will eventually have to bear the cost, even though they have been pushing for a higher ex-farm price.

Tesco may be set to face strong
opposition from the dairy industry over its decision to cut milk
prices. Although Tesco and its rivals that have followed suit have
said that farmers will not suffer from the reduction in retail
prices, the National Farmers Union has put little faith in that.

Not only does this create a difficult
climate for negotiating autumn milk price increases, but puts real
pressure on farmers who fear that the supermarkets will be looking
for cuts in the longer-term.
A spokesman for Tesco replied, "In
the current economic climate (retail] customers are telling us that
they want a range of products which will help to ease some of the
financial pressure they are facing. We believe that we can deliver
this without any impact on the farm gate price we offer."