ARLA Foods yesterday warned that delays in increasing the price paid by supermarkets for its products would hit profits.
The UK's largest supplier of butter and milk, which has two plants in the region, increased the price of its goods to counter rises in packaging, utility and energy bills.
But this happened more slowly than hoped, meaning profits in the six months to the end of March would be less than expected, Leeds-based Arla said.
The company said ahead of its annual meeting that earnings for the following six months would be in line with expectations.
The price negotiations added 1p to the price of a four-pint carton of milk, taking it to £1.16, Arla said.
The company, which has dairy processing plants in Northallerton, North Yorkshire, and Benton, Newcastle, supplies milk to Asda, Morrisons and Tesco.
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