Scotland-based Robert Wiseman Dairies has been awarded a £66 million-per-year (US $118 million) milk supply contract with United Kingdom supermarket giant Sainsbury. Dairy Crest will become Sainsbury's other partner beginning in January 2005.
Sainsbury said the two dairies will help it maintain relationships with more farms than its competitor Asda. Both Dairy Crest and Wiseman are supplied by First Milk, a UK milk co-operative with 4,000 farms.
Earlier in 2004, Asda named Arla as its only UK milk supplier and let go of its other suppliers, including Wiseman and Dairy Crest. Wiseman reportedly lost about £70 million (US $125 million) in revenues from the loss of Asda. Wiseman provided nearly half of Asda’s milk, or 15% of Wiseman’s yearly milk volumes. The dairy group’s shares subsequently fell 17%.