Fonterra Australia has increased its average farmgate milk price for the 2021/2022 season by 20 cents per kgMS, comprising 17 cents per kg of butterfat and 24 cents per kg of protein.
This takes Fonterra’s average farmgate milk price to $7.30/kgMS, which will be backdated from 1 July 2021.
Fonterra Australia Managing Director, René Dedoncker, said that this price rise comes on the back of continued strong dairy prices coupled with the good performance of Fonterra Australia’s business.
“We know that the dry summer in many regions and higher input costs on farm are impacting profitability, so we hope that passing on this increase now will help offset some of these costs.
“Although we are seeing historically high commodity prices and a weaker Australian dollar, the decline in milk production in Victoria and Tasmania is limiting the upside from export markets.
“We also continue to see the impacts of the global supply chain disruption on our business with no immediate end in sight, and more recently the domestic supply chain has been severely impacted by COVID,” said Mr Dedoncker.
More detail on Fonterra’s business performance will be available when it announces its first half results for FY22 on 17 March 2022.