ARLA announced a a further cut in the price it pays its milk producers just two days before Christmas Day.

The cut of 2.03ppl from January 5 will see its 3,000 dairy farmers receive 24.81ppl and follows a 1.63ppl cut in December.

Ash Amirahmadi, Arla’s UK head of milk and member services, said: "Global supply and demand are still out of balance which is continuing to create downward pressure. The knock on impact of weak international prices on the European markets has affected Arla’s business performance, as well as that of the entire dairy industry in Europe."

Meurig Raymond, NFU president, said it was the worst possible Christmas present for the farmers who supplied Arla.

"It couldn’t have come at a worse time and this latest reduction will continue to place huge pressure on cash flows for these farmers in the months ahead," he said, "It is vital that we don’t see this trend continue through other processors’ February price announcements.

"For the first time producer numbers have dipped under 10,000 with 60 going out of business in November alone. We will continue to put pressure on government, retailers and the processors with the aim of trying to rebuild an economically sustainable dairy industry. We cannot emphasise enough how awful this downward spiral has been for the dairy industry in the UK."

Rob Harrison, NFU dairy board chairman, said the announcement was another body blow for the industry.

"But despite this news, dairy farmers across the country, including myself, will continue to provide the nation’s milk – working 52 weeks a year, without a break, and yes, even on Christmas day we’ll be up and in the parlour at 4am before being able to spend some precious time with our children and families.

"All we ask is that the public continues to buy British dairy products, including British cheese, look out for the Red Tractor logo and continue to back British farming."