“There has been further upward inflation in farmgate milk prices,” wrote analyst Jonathan Snape in a note following Bega’s trade update.

“Given the substantial escalation in recent months, we have also moved to incorporate further pricing gains in the branded portfolio (reflective of cost pressures that retailers are likely to face in direct supply).”

The ASX-listed company’s trading update comes as supermarket giant Coles and Woolworths both confirmed they were increasing retail prices for milk by as much as 60 cents after having to pay more to farmers.

“Across the dairy cabinet, brands have already increased their retail prices to reflect higher wholesale costs across the entire industry,” said a Woolworths spokesperson. “We’ll be adjusting the price of our own Woolworths brand milk in the coming days to reflect these higher costs as well.”

In afternoon trading, Bega shares were 9 per cent lower at $3.24, their lowest level since 2013.