Fonterra announces forecast Farmgate Price for season 2017/18 and additional payment for its Australian farmers


Fonterra Australia has announced its forecast full year farmgate milk price range for the 2017/18 season, six weeks before the start of the season, honouring its ongoing commitment to provide clear and timely price guidance to suppliers.

  • A forecast full year farmgate milk price range of $5.30 to $5.70 per kilogram of milk solids (kgMS) for season 2017/2018 for Australian suppliers.
  • An additional payment of 40 cents per kgMS payable for the season 2017/2018 to its Australian suppliers.
  • This brings Fonterra’s forecast full year range to $5.70 to $6.10 per kgMS for the 2017/18 season.

Fonterra Australia Managing Director René Dedoncker said our business is in a stronger position, which underpinned its competitive forecast full year range of $5.30 to $5.70 per kilogram of milk solids (kgMS). This range is based on current currency exchange rates and commodity market conditions.

“Providing Fonterra’s forecast full year price range now is aimed at giving our farmers guidance so that they can plan for next season with confidence,” said René.

“We’ve invested in world-class assets, improved our product mix, and exited non-strategic businesses. This coupled with the rebalancing of global supply gives us the ability to pay a competitive milk price to our farmers.

“A competitive price supports our investments, helping us to utilise the re-built capacity at Stanhope, capture global demand, and ultimately deliver higher returns to our Australian farmers and our owners.”

Fonterra has also announced that it will pay its Australian suppliers an additional payment of 40 cents per kgMS next season, bringing its forecast full year milk price range to $5.70 to $6.10 per kgMS.

“We said that we would consider Murray Goulburn’s recent announcements including the decision to forgive its Milk Supply Support Package. We’ve consulted with the Bonlac Supply Company on the best way to respond to our suppliers,” said René.

The additional payment of 40 cents per kgMS will be available to all current, retired and recommencing suppliers. Fonterra will also be reimbursing the interest charge for the Fonterra Australia Support Loans package that was included in this season’s milk price to all current suppliers.

“We believe this payment is the right thing to do and we’re committed to ensuring our farmers are better off by partnering with us.”

Fonterra’s opening price for season 2017/18 will be announced closer to the beginning of the season.

Further information on the additional 40 cent per kgMS payment

  • The payment will be available to all current and recommencing Fonterra suppliers, and will be paid monthly on top of next season’s milk price.
  • The payment has been tailored to suit suppliers’ cash flow and growth needs.
  • Fonterra suppliers who have supplied Fonterra continuously since 30 April 2016 have the option to receive the payment as an advance by 31 July 2017. Full terms and conditions of the advance offer will be set out in the advance application form.
  • Retired Fonterra suppliers who left the dairy industry between 30 April 2016 and 10 May 2017, and did not supply any other company in that period, will also receive the payment as a lump sum payment by 31 July 2017.
  • Fonterra will also be reimbursing the 0.85 cent per kgMS interest charge that was included in this season’s milk price for current Fonterra suppliers, and this will be repaid by 31 July 2017.
  • We are committed to talking to every farmer interested in knowing more.