Fonterra revises prices

A STEP up from Fonterra Australia is good news for South Gippsland suppliers, as the season continues to present challenges.
Fonterra has increased its 2017-18 farmgate milk price by 10 cents per kilogram of milk solids, bringing its average price to $5.62kgMS.
Nerrena Fonterra supplier Terry Clark said the step up was welcome, even if the forecast closing price was reduced.
Fonterra has revised its forecast closing milk price range, to $5.62 to $5.70kgMS.
“We remain committed to providing our farmers with clear market-based signals and the 10 cents/kgMS reduction in the top end of our forecast range is a prudent way to reflect the impact of global volatility,” Fonterra Australia managing director René Dedoncker said.
“However, demand for dairy remains strong in key regions and we are confident with our increased farmgate milk price in the current conditions.”
Mr Clark said he was feeling reasonably confident about the remainder of the season.
“A hot and dry November along with army worm infestations has taken some of the confidence out of our season,” he said.
“We had to start feeding our milkers on November 29, which is the earliest date we have ever started hand feeding.”
Mr Dedoncker said Fonterra Australia’s business was growing stronger as its product mix rebalances, enabling good returns from the market.
“Our plants, including our recently reopened Stanhope cheese plant, are operating efficiently,” he said.
“We’re continuing to grow our Australian business and will soon announce the investments we are making across our manufacturing sites that will allow for an additional 500 million litres of processing capacity.
“We are also exploring ways that we can work more closely with our suppliers, including whether there was a cooperative solution for our Australian suppliers.”
Mr Clark said he thought Fonterra was taking the right action to increase milk intake, as long as it could handle the extra litres.
“You hear stories of them giving milk away to other factories and tipping it out,” he said.
“Hopefully factories running more efficiently will generate a better farmgate price.”
Mr Clark said he hoped Fonterra abandoned the idea of developing a cooperative.
“Cooperatives in this country have had their day, so I don’t see it as a positive move at all and I don’t think anything will come of it,” he said.

Short URL: http://thestar.com.au/?p=23514

Posted by on Dec 19 2017. Filed under Rural News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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