June 06, 2018

Fonterra Australia announces forecast closing farmgate milk price range for the 2018/19 season

Fonterra Australia has today advised farmers its forecast closing farmgate milk price for the 2018/19 season is in the range of $5.50 to $6.20 per kilogram of milk solids (kgMS).

The range is based on market indications which show a continued positive global supply and demand picture. Demand is expected to remain strong – especially from China and for butter and AMF – and the global dairy market’s current prices are expected to continue throughout the new season.

Fonterra Australia Managing Director René Dedoncker said Fonterra remains committed to paying its farmers a price that is market-based, competitive, and sustainable.

“We are keeping to our promise to provide farmers with clear market-based signals in advance of the new season to allow them budget and plan.

“Earlier this year we launched Farm Source in Australia – a comprehensive package of tools and services to assist farmers with farm business management – which is changing the way we work with our farmers. The Farm Source online income estimator will be available in the coming weeks to provide our farmers with the ability to scenario plan for next season.

“Our business is in good shape as we continue to focus on driving sustainable performance.

“We’re building long-term relationships with strategic partners, and with cheese markets like China and Japan, to tap into growing domestic and global demand which is providing more opportunities to grow the value of our farmers’ milk. At the same time, we continue to make efficiency improvements which means we have the right asset base to play to our strengths in cheese, whey and nutritionals.

We are confident that our strategy and the strength of our three business channels – Consumer, Foodservice and Ingredients – will enable us to continue to pay a competitive price next season. We expect seasonal growth from our existing farmers to continue next season which will meet our customer demand.

“We will announce our opening price in the coming weeks,” concluded Mr Dedoncker.