Synlait slump
OPINION: Synlait's woes continue to drag the company down. The listed milk processor’s share price dropped to an all-time low of 30c last week, valuing the company at around only $65 million, a huge slump from its peak value.
Listed milk processor Synlait has announced an opening forecast base milk price of $8/kgMS for the new season.
The company, with milk plants in Canterbury and Waikato, says it has taken a conservative approach to its forecasts given the exposure to future global dairy commodity prices, which are volatile in nature, at the beginning of the season.
The company is sticking to the 2023-24 forecast base milk price of $7.80/kgMS.
Synlait says its farmer suppliers have received, on average, $0.28/kgMS incentives above the base milk price for the last two seasons. The company is forecasting to pay similar incentives for the next two seasons.
“Forecasts are based on the best information available to Synlait at the time. Synlait will continue to monitor movements and keep farmer suppliers updated as required,” it says.
The final milk price for the 2023-24 season will be confirmed when the company’s full year result is released in September. The 2024-25 season forecast will also be updated at the same time.
Earlier this week, Fonterra announced as opening forecast range of $7.25-$8.75/kgMS, with a midpoint of $8/kgMS.
The co-op says milk supply and demand dynamics remain finely balanced and China import volumes have not yet recovered to historic levels.
“Given the early point in the season, the uncertainty in the outlook and ongoing risk of volatility in global markets, we are starting the season with a cautious approach,” the co-op says.
As storms and flooding continue to batter the East Coast, the Insurance & Financial Services Ombudsman has issued advice for those impacted and looking to claim with their insurer.
Federated Farmers Gisborne/Wairoa president Charlie Reynolds says farmers are in need of emotional support after rain, wind and flooding hit the region this week.
Minister for Emergency Management Mark Mitchell says the Mayoral Fund has been triggered, activating $300,000 for regional recovery after severe weather hit the East Coast this week.
States of Emergency have been declared in Haumoana, Wairoa and Hastings after storms have once again battered the East Coast of the North Island.
Dairy processors are happy with the Government’s move to reduce redtape for exporters.
The fortunes of the dairy industry are expected to bounce back in about a year’s time, according to the Director General of the Ministry for Primary Industries (MPI), Ray Smith.
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