FONTERRA AUSTRALIA OPENS AT $6.06 PER KGMS

The minimum price, as set out in Fonterra’s base and seasonal rates table, along with the Milk Supply Agreements, are available to farmers on Fonterra’s dedicated website at www.farmsource.com.au/pricing.

Fonterra Australia Managing Director René Dedoncker says that Fonterra’s prices have considered all factors including the uncertain market conditions caused by COVID-19.

“Global commodity prices have softened and are back to early 2019 levels with GDT average prices between $2,800 and $3,000 USD a tonne. After considerable volatility, the Australian dollar has stabilised between US$0.64 and US$0.66 and we have based our pricing on this range.

“The impact of COVID-19 on economies and the market is still largely unknown and we are seeing softening of demand relative to supply which is putting downward pressure on prices.

“We anticipate that global dairy markets will be uncertain for some time. The global downturn is continuing to reduce consumers’ purchasing power while the foodservice industry remains impacted by restrictions in the tourism and the hospitality sectors.

“The last month has given some cause for optimism in the year ahead, with improvements in key product values. By the end of June, we’ll have more certainty on our next six-monthly product pricing, including key cheese export contracts. We will provide our farmers with an update on this by the end of June, including any resulting impact on our price forecast.

“Fonterra’s market-leading consumer brands and value-added ingredients portfolio are providing strong options to put milk into. Like our suppliers, we will be head down, doing the basics well and focusing on costs to secure the best margins,” says Mr Dedoncker.