onterra has reduced its forecast farmgate milk price for the 2015/2016 season by 6% from NZ$4,15 per kg milk solids to NZ$3,90 per kg milk solids. Chairman John Wilson said the challenging conditions in the global dairy market have put further pressure on the forecast.
Fonterra expects that milk production will be at least 4% lower this year as producers respond to lower producer prices. In addition, less supplementary feed is available to feed cows.
Fonterra stated “This further reduction in the forecast farmgate price is the last thing farmers want to hear in what is proving to be a very challenging season. At times like this the business needs to do everything it can to drive every cent back to farmers.” It admitted that the prices are unsustainably low for New Zealand dairy farmers, but farmers globally are generally now feeling the pressure.
Chief executive Theo Spierings said the medium-term outlook for dairy is positive owingto growing demand on the back of a growing world population, an increase in middle-class consumers and urbanisation. However, in the short term the volatility experienced over the past three or four years is really hitting New Zealand dairy farmers hard at the moment. To read more, click HERE.14
Published on Monday, 14th March 2016 - 14:00
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