New Zealand dairy cooperative Fonterra has increased its farmgate milk price in Australia by $0.20 per kilogram of milk solids from 1 July, bringing the average milk price to $5.50 per kilogram.
Fonterra Australia's managing director René Dedoncker said that improved market conditions and the strength of the Australian business supported this price increase.
“Since the start of this season our milk pool has grown, and our assets are nearing optimal capacity,” said Dedoncker. “Coupled with strong demand from Fonterra’s Australian and global customers, this has enabled us to deliver this step up to our farmers. This price increase will improve cashflow positions on farm, reinforcing growing confidence of our farmers.”
Outlook
Fonterra has also updated its forecast closing milk price range to between $5.50 and $5.80 per kilogram of milk solids, and noted that while the commodity prices are strong, the rally in the Australian dollar is likely to influence the end of season milk price within that forecasted range.
“We continue to monitor currency movements closely and will keep our farmers updated throughout the season with the latest market conditions,” added Dedoncker.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.
