Farmers Pleased With Payout Forecast

23 May 2007

Farmers Pleased With Payout Forecast

Dairy farmers will be very pleased with Fonterra Co-operative Group’s forecast payout for the next season, said Dairy Farmers of New Zealand chairman, Frank Brenmuhl.

Mr Brenmuhl’s comments follow Fonterra forecasting a payout $5.53 a kilogram of milksolids for the season 2007/08.

“Farmers have reasonable confidence that high commodity prices will continue for the next few years due to increased international demand and tight supply.

“These higher returns should give long term confidence to the New Zealand dairy industry and its ability to continue to outperform other sectors of the economy.

“The increase is positive news for Fonterra suppliers who, like other farmers, are facing dramatically increased operating costs such as local government rates, RMA compliance costs and fuel.

“This payout will enable farmers to repay debt, carry out deferred maintenance and reinvest in their farming businesses.

“The forecast is a boost to morale for dairy farmers and in addition to helping cash flow, the increase will have flow-on benefits to rural communities.

“Finally, the increase in the advance for next season to $3.50, in June/July, rising to $3.60, in August/September, will be welcomed by farmers,” Mr Brenmuhl said.

ENDS

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