HOT on the heels of First Milk's upbeat business update, the farmer-owened company has announced a drop in milk prices from December 1.

Farmers supplying creameries,including the one at Haverfordwest, will see a 0.43pence per litre fall.

The moves has been blamed on an increase in supplies across the EU and weakening prices for cheese.

Interim chairman Nigel Evans commented: “Last week we provided updates on the improving financial performance of the business and the agreement to sell our Glenfield Dairy.

"However, with growing supplies across the EU, prices for cheese have continued to weaken and this impacts our projected returns from December. This directly affects our creamery milk pools and those other pools whose milk is utilised mainly for cheese.

“Obviously as a dairy farmer, I fully appreciate how serious the current market conditions are for members' businesses. The impact of weak returns and excess milk volumes are being felt around the world.

"As interim chairman, I am focusing on the things we can influence, which are ensuring First Milk continues to improve both its financial and operational performance and reshaping our governance structure to deliver a more commercially effective board.”