Fonterra lowers farmgate milk price

13 May 2016

Fonterra Australia has revised its farmgate milk price, meaning that the full 2015/16 season price will be reduced from A$5.60 per kgMS to A$5.00 per kgMS.

Fonterra lowers farmgate milk price

Fonterra Australia has revised its farmgate milk price, meaning that the full 2015/16 season price will be reduced from A$5.60 per kgMS to A$5.00 per kgMS.

It has also announced the Fonterra Australia Support Loan, which offers a loan of up to 60c per kgMS that is repayable from FY18 onwards for those who choose to take up the loan. This provides suppliers with options to help deal with the current challenging conditions, and gives them the ability to receive an equivalent of $5.60 per kgMS for the current season.

Managing Director Fonterra Oceania Judith Swales said the price change reflected the reality of the supply and demand imbalance that is affecting global dairy commodity prices, compounded by the recent strength of the Australian dollar.

“The reduction in the farmgate milk price is the last thing farmers want to hear – however, it is unlikely to come as a surprise,” said Swales. “With around 40 per cent of Australia’s milk exported, our ongoing message has been that Australia is not immune to the global dairy challenges, that the milk price did not reflect current reality and that farmers need to budget conservatively.Fonterra is committed to taking a leadership position to drive towards more transparency on milk price so that farmers have a clear line of sight to budget, plan and respond.”

Fonterra says it has continued to meet its commitments and honour the agreement with its suppliers through the BSC Milk Supply Agreement.

“At the same time, we continue to transform our business. We’ve significantly driven out costs, we’re growing our nutritionals business, building our leadership positions in retail and foodservice and we are on target to return to profit,” said Swales, noting that Fonterra was firmly committed to supporting farmers, despite the obvious business challenges the milk price reduction would cause.

“We have the right strategy and we are delivering on a clear, sustainable plan. Work is underway to rebuild our Stanhope cheese plant with 50 per cent extra capacity and we are growing our nutritionals business with Bellamy’s and Beingmate. Our priority is ensuring a long-term sustainable business for Fonterra and for our farmers that supply us.”

Related tags

Dairy

Related news

Danone expands plant-based yogurt production

Danone expands plant-based yogurt production

11 Feb 2019

Danone North America has opened a new building at the company’s DuBois, Pennsylvania facility to increase production of its plant-based foods to meet growing consumer demand.

Read more 
Mintel looks at trends in yogurt

Mintel looks at trends in yogurt

7 Feb 2019

In a blog post, Amrin Walji, a Senior Innovation Analyst at Mintel who specialises in analysing trends driving product innovation and development across the food and drink industry, describes four global yogurt trends to look for in 2019.

Read more 
Ingredion extends Inside Idea Labs in EMEA to dairy

Ingredion extends Inside Idea Labs in EMEA to dairy

28 Jan 2019

Ingredion has extended its virtual lab, Inside Idea Labs in EMEA, to the dairy market, bringing its application expertise in dairy product formulation to its customers 24/7.

Read more 
Nestlé opens infant nutrition R&D centre

Nestlé opens infant nutrition R&D centre

28 Jan 2019

Nestlé has opened a research and development centre for maternal and infant nutrition in Limerick, Ireland.

The opening marks the completion of a three three-year construction program with an investment of €27 million.

Read more 
Yofix Probiotics launches dairy-free, soy-free yogurt alternative

Yofix Probiotics launches dairy-free, soy-free yogurt alternative

25 Jan 2019

Yofix Probiotics, the winner of PepsiCo’s European Nutrition Greenhouse Programme 2018, has launched its first dairy-free, soy-free yogurt alternative line with three fruit flavours.

Read more 
Mintel: India represents strong opportunity for milk

Mintel: India represents strong opportunity for milk

23 Jan 2019

India may be one of the largest milk producers globally, but the latest research from Mintel highlights strong opportunity to boost regular milk's health credentials.

Read more 
Valio gets China go-ahead for infant formula

Valio gets China go-ahead for infant formula

14 Jan 2019

Valio’s consumer-packaged infant formulas have received an export permit from the Chinese authorities. These new export permits allow Valio to export its powdered infant formulas to China.

Read more 
Arla intros 'optimized comfort' infant formula concept

Arla intros 'optimized comfort' infant formula concept

11 Jan 2019

Optimized comfort is at the heart of a new whey protein-based concept for infant formula developed by Arla Foods Ingredients which alters the amount and types of proteins in formula.

Read more 
FrieslandCampina acquires US speciality cheeses company

FrieslandCampina acquires US speciality cheeses company

31 Dec 2018

FrieslandCampina has acquired the activities of Best Cheese Corporation USA., importer and vendor of specialty cheeses in the United States.

Read more 
Mondelēz sells MEA cheese business to Arla

Mondelēz sells MEA cheese business to Arla

18 Dec 2018

Mondelēz International has announced that it has reached an agreement to sell its Kraft-branded Cheese Business in Middle East and Africa (MEA) to Arla Foods of Denmark.

Read more