By David Winning
SYDNEY–Fonterra Co-operative Group raised its farmgate milk prices forecast, citing an improvement in the outlook for dairy supply and demand.
The cooperative said it now expects a farmgate milk price of between 6.50 New Zealand dollars (US$4.33) and NZ$8.00 per kilogram of milk solids. A midpoint of NZ$7.25 represents an increase of 50 New Zealand cents, Fonterra said.
“Here in New Zealand we’re forecasting collections to be slightly below last season, while aggregate milk growth in key export countries is expected to be below average for FY 2024,” said Chief Executive Miles Hurrell. The El Niño weather pattern may have further impacts on supply, and this could be driving recent buyer sentiment.”
He also pointed to recent results at the GlobalDairyTrade auction. Last week, whole milk powder prices rose by 4.8% at the auction and skim milk powder prices lifted by 6.6%. Overall, the broader GDT Price Index was up 4.4% on the previous auction.
“While this has been encouraging, it is not yet clear whether the stronger demand from China will be sustained,” Hurrell said. “For other key regions, customers remain relatively cautious in terms of their forward purchases.”
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