The two retailers had found themselves in a position where their previously announced July milk prices were significantly adrift of the prices being announced by other buyers.
As a result, suppliers in Tesco’s Sustainable Dairy Group (TSDG) through Muller will now be paid 46p/litre from 1 July for a standard liquid litre of 4% butterfat and 3.3% protein.
This is 3.65p/litre higher than the previously announced July price of 42.35p/litre.
The price for Arla Direct TDSG suppliers will be 45.75p/litre.
A statement from Tesco said the revised TDSG milk price followed continued volatility in the sector.
“It is hoped the rise will help to address the current unprecedented levels of on-farm inflation.”
Meanwhile, Sainbury’s has announced a 4.3p/litre temporary booster payment for farmers in the Sainsbury’s Dairy Development Group.
Those on Muller contracts will receive 46p/litre, rather than the 41.7p/litre announced previously, for a standard litre of 4% butterfat and 3.3% protein.
Farmers with Arla contracts will be paid 45.88p/litre, which takes into account the company’s 0.12p/litre haulage charge.