Robert Wiseman Dairies today warned it would increase the farm-gate price of its products this winter.
Robert Wiseman, which operates from seven dairies across the UK, said it would raise prices to ensure the long-term supply of milk for its customers.
The supplier, which earlier this year signed a major deal with the Co-operative Group, has come under pressure from surging diesel and raw material costs.
The price warning comes as research from the British Retail Consortium showed a 2.9 per cent rise in food prices in June, putting more pressure on consumer spending power.
Robert Wiseman, which supplies a third of Britain’s fresh milk, said that trading for the 13 weeks to July 2 was in line with expectations.
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The company said sales volumes would benefit from the start of the deal with the Co-op from August, when Robert Wiseman will supply all of the supermarket’s own-brand milk.
The Co-operative Dairy Group, formed from the deal, will benefit some 240 Wiseman producers, the company added.
Robert Wiseman said that diesel costs were 15 per cent higher in the period, compared to last year, while the cost of resin used to produce its plastic bottles was 18 per cent higher.
The group said it continued to invest in the business in a move to generate cost savings. New refrigeration equipment at its Manchester dairy has reduced gas usage by 50 per cent.
Robert Wiseman, the chairman, said: “Over the past 12 months, the business has experienced unprecedented pressure on margins and significant increases in input costs. Despite these pressures, we have continued to gain volumes and have achieved record levels of efficiency.”
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Shares were up almost 3 per cent, or 9.25p, at 323.25p.