Community
12 June, 2024
Fonterra season opener
FONTERRA Oceania has announced its 2024/25 opening weight average Australian milk price at $8 per kilogram of milk solids.
In a letter to suppliers, Fonterra Oceania managing director René Dedoncker said the price supports the scenario planning Fonterra have been undertaking with Australian farmers since November to prepare for a milk price which reflects the shift in market conditions.
“In recent years, our industry has seen higher commodity prices, stronger consumer demand and a shortage of milk to meet its demand,” he said in the suppliers letter.
“However, heading into FY25, the global market for cheese, which is a strong contributor to our prices, has declined since the start of FY23.
“Cost of living pressures have led to softer domestic consumer demand and higher volumes of lower cost dairy imports.
“This, together with increased milk production in all dairy regions, has contributed to excess cheese inventory in the Australian market driving pricing down further.”
Mr Dedoncker believed the opening price reflected those dymanics.
“We are well placed to manage through the dynamic market conditions and remain a secure home for your milk,” he said.
“We have a strong business with choice in which markets and channels we serve, as well as the products we make.
“We are committed to paying a competitive milk price throughout the season and, as part of our bi-monthly review process, we will continually assess market conditions and pass on price increases when they are supported by the market and our business performance.”