Fonterra Whareroa sets cheese record, wins top award
Fonterra Whareroa wrapped up a successful season with a record-breaking cheese production volume and several gongs at the co-op's annual Best Site Cup awards.
NZ dairy farmers need to keep the focus on the cost of production, because New Zealand is the only system in the world that can live through the current volatility, says Fonterra chief executive Theo Spierings.
"I know it's not nice but the scene in Europe is much worse than what you see here because their cost price is almost double," Spierings told Dairy News.
The middle to long term prospects are "absolutely good", he says.
"Our strategy is connected to the market opportunities and our strategy is working," he says. "But at this point in time .... There are multiple areas in the world, demand pools, which have dried up for a while.
"While the middle to long term is positive, the farmers will have to manage through these low prices and the only way to do that is manage your cost price.
"We will try to do get as much money from the market as possible, but cost price on farm is crucial. We have to turn the wheel, get value from the market. Our farmers are focusing on cost."
Farmers will hopefully have enough to keep going with the current forecast of $4.50/kgMS farmgate milk price, with the 50c support and 40-50c earnings per share, bringing the payout to a potential $5.60 including the loan.
"I really do believe in the second half of this year we could see a completely different scene with a significant weather event."
Questions are being raised about just how good the state of the dairy industry is - especially given that the average farmgate payout for the coming season is set to exceed $10/kgMS.
A leading financial and banking advisor says he doubts if most dairy farmers fully understand the dynamics of banking.
Dairy farmers are shoring up their balance sheets, with almost $1.7 billion of debt repaid in the six months to March 2025.
Virtual fencing company Halter is going global but for founder Craig Piggott, New Zealand farmers will always remain their main partners.
A former Fonterra executive is the new chair of the Dairy Companies Association of New Zealand (DCANZ).
New Federated Farmers national dairy chair Karl Dean is looking forward to tackling the issues facing the sector.
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