Tuesday, 27 August 2013 15:42

Fonterra hikes payout forecast

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Fonterra has lifted its forecast farmgate milk price the 2014 season by 30 cents to $7.80 per kg/MS.

 

The increase – along with a previously announced estimated dividend of 32 cents per share - amounts to a forecast cash payout of $8.12.

Fonterra is required to consider its farmgate milk price every quarter as a condition of the Dairy Industry Restructuring Act (DIRA).

Chairman John Wilson says the higher forecast farmgate milk price reflects continuing strong international prices for dairy.

"Current market views support commodity prices remaining at historically high levels longer than previously forecasted," says Wilson.

"The two most recent GDT (GlobalDairyTrade) events have seen prices hold, and significant volumes sold. These factors have contributed to our updated forecast."

At this early stage in the season, however, Wilson says there are a number of uncertainties – and that was why there would be no change to the current advance rate announced in July.

"We will provide an update on business performance when we announce our annual result on September 25, 2013," said Mr Wilson.

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