BNZ lifts milk price forecast to $10.25/kgMS for 2025-26
A stronger than expected outlook for dairy has prompted one bank to lift its 2025-26 season forecast milk price by 75c to $10.25/kgMS.
He told Rural News that, in some ways, the recent GDT price strength looks like catch up due to the recent declines in the US dollar.
A lower US dollar tends to lift product prices that are denominated in that currency.
“Of course, the flipside of a lower US dollar is a higher NZ dollar, while a higher NZ dollar – in itself – tends to put downward pressure on milk price, it very much needs to be seen in the context of product price movements in offshore markets.
“These things do not move in isolation. It is the balance that matters.”
Steel points out that it was no coincidence that the 2013-14 record $8.40 milk price was paid when the NZD/USD was above 0.80.
“That said, a higher NZD/USD will limit the upside to domestic milk prices, but likely more so for next season than the current one.”
