Milk boom

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Milk boom

IT’S absolutely fantastic.
That’s how dairy farmer Leo Argento of Leongatha North described Murray Goulburn’s step up price announced last week.
“It’s the beginning of a good turn around,” he said.
“This spring (the price) is close to 50 per cent more than last spring.
“It’s very welcome indeed. It’s good for the local economy.”
Mr Argento said the step up adds another cent a litre to the farm gate price.
“But more importantly, it puts Murray Goulburn back in the very competitive range,” he said.
“Its worst days are behind it and it’s back in front and back in business and ready to perform.”
And that’s just where dairy farmers want their company to be.
“Murray Goulburn is sending a clear indication it wants to be market leader,” Mr Argento said.
The dairy cooperative announced a step up of $0.09 per kilogram for butterfat and $0.19 per kilogram for protein, taking the weighted average available price to $5.86 per kilogram milk solids.
On top of that good news, Murray Goulburn has also increased its end of season forecast to a range between $5.95 and $6.20 per kilogram milk solids.
When the cooperative’s opening price was announced early in June, the end of season forecast was $5.80 to $6 per kilogram milk solids.
Mr Argento said the full impact of the step up on farmers won’t be known until around Christmas. He said they would start to realise with their spring milk cheques they are “in a lot better position”.
The step up has also been welcomed by Leongatha Chamber of Commerce and Industry president Peter Watchorn, who said giving money back to farmers at the farm gate would boost local businesses.
Mr Argento said he has been one of a number of farmers pushing Murray Goulburn to increase its spring price because that’s when farmers’ margins are made and the time when they are more likely to invest.
“I’m glad management has taken that on board and I’m very impressed with the latest step up,” he said.
Mr Argento said last spring, suppliers’ milk was worth 26 cents a litre, with this step up, it will bring the price to close to 38 cents a litre.
“That’s a huge benefit. It will help farmers pay their bills,” he said.
Local agricultural consultant John Mulvany echoed that sentiment.
“Overall, having a step up early in the season will really help cash flow,” he said.
“Dairy farmers have been under huge pressure.”
He said the overall milk price for the year was looking healthier than it had for four or five years, adding a significant easing in dairy farmers’ cash flow means the local service community will benefit.
Announcing the step up, MG managing director Gary Helou said it provides a further $30 million into the cooperative’s cash flows.

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Posted by on Aug 20 2013. Filed under Featured, 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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