$8 final milk price likely
An $8/kgMS farm gate milk price is still on the cards with less than six weeks left to run this season.
Fonterra is sticking to its 2020-21 season forecast payout range of $5.90 to $6.90/kgMS as dairy prices slipped further in the overnight auction.
Last night’s Global Dairy Trade (GDT) auction saw the price index fall 1% compared to the previous auction. Dairy prices have now fallen on the four GDT events since July.
Whole milk powder price slipped 2% to US$2,884/metric tonne.
In an email to shareholders Fonterra chairman John Monaghan said that the global market was finely balanced at the moment, with both demand and supply increasing but it has the potential to change.
“There is good demand in market at this stage of the season, however, the forecast economic slowdown is likely to increase global unemployment and reduce consumer demand.
“The potential for additional waves of COVID-19 is also impacting the confidence of some of our foodservice customers.”
On the supply side, global milk production has bounced back stronger than expected and volumes in the key dairy production regions of the EU and US are anticipated to be up on last year.
Monaghan says at this early stage of the season, any movement in the market can have a significant impact on the milk price.
“For that reason, we recommend caution with your on-farm financial decisions.”
Key results
AMF index down 0.5%, average price US$3,852/MT
Butter index down 1.2%, average price US$3,334/MT
BMP index up 3.9%, average price US$2,356/MT
Ched index down 0.4%, average price US$3,428/MT
LAC index up 0.8%, average price US$1,314/MT
SMP index up 1.8%, average price US$2,663/MT
SWP index not available, average price not available
WMP index down 2.0%, average price US$2,884/MT
New Zealand dairy processors are welcoming the Government’s commitment to continuing to push for Canada to honour its trade commitments.
An educational programme, set up by Beef + Land New Zealand, to connect farmers virtually with primary and intermediate school students has reported the successful completion of its second year.
The Food and Agriculture Organisation of the United Nations (FAO) has welcomed a resolution adopted by the United Nations (UN) General Assembly to declare 2026 International Year of the Woman Farmer.
Waikato herd health veterinarian Katrina Roberts is the 2024 Fonterra Dairy Woman of the Year.
Trade Minister Todd McClay says New Zealand has no intention of backing down in a trade dispute with Canada over dairy products.
There have been leadership changes at the Hamilton-based Dairy Goat Co-operative, which has been struggling financially in recent years.
OPINION: Canterbury milk processor Synlait is showing no sign of bouncing back from its financial doldrums.
OPINION: It seems every bugger in this country can get an award these days.