Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Fonterra hikes forecast pay-out to farmers further

Fonterra hikes forecast pay-out to farmers on firm global demand

By Paul McBeth

Feb. 27 (BusinessDesk) - Fonterra Cooperative Group, the world’s biggest dairy exporter, has raised its forecast pay-out to farmers as global demand for milk powders remains strong, while holding its expectations for a reduced dividend.

The Auckland-based company expects to pay $8.65 per kilogram of milk solids to farmers in the 2013/14 season, up from a previous forecast of $8.30 per kgMS, it said in a statement. The dairy company held its forecast dividend of 10 cents per share.

The increase is 70 cents lower than what it would be using calculations from regulated milk price manual, carrying on Fonterra’s decision to pay a lower price due to the production mismatch when prices for its whole and skim milk powder surged ahead of its higher margin products such as cheese and butter.

“The increase reflects continuing strong demand for milk powders globally,” chairman John Wilson said. “The board has the discretion to pay a lower Farmgate Milk Price than that specified in the manual, if it is in the best interests of the cooperative.”

The New Zealand dollar rose to 83.11 US cents at 8.45am in Wellington from 82.85 cents immediately before the announcement.

In December Fonterra slashed its forecast dividend to 10 cents from 32 cents, while keeping the forecast farmgate pay-out unchanged as surging prices for whole and skim milk powder weren’t matched by higher-value products such as casein and cheese.

At the time, Fonterra said it was limited by its plant configuration on how much milk powder it can produce, with about 70 percent of production capacity for milk powder and the remainder making cheese and casein.

Fonterra’s Wilson said the company will provide an update on the business performance when it announces its first-half result on March 26.

The company’s board also approved an increase of 25 cents per kgMS in the advance rate schedule of monthly payments from March through to June.

Units in the Fonterra Shareholders’ Fund, which provides investors exposure to the company’s dividend stream, rose 1.1 percent to $6.22 yesterday, and have gained 7.2 percent this year.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Wine: 20% Of Marlborough Storage Tanks Damaged By Quake

An estimated 20 percent of wine storage tanks in the Marlborough region, the country’s largest wine producing area, have been damaged by the impact of the recent Kaikoura earthquake. More>>

ALSO:

ACC: Levy Recommendations For 2017 – 2019 Period

• For car owners, a 13% reduction in the average Motor Vehicle levy • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy. More>>

Women's Affairs: Government Accepts Recommendations On Pay Equity

The Government will update the Equal Pay Act and amend the Employment Relations Act to implement recommendations of the Joint Working Group on Pay Equity. More>>

ALSO:

Immigration: Increase In Seasonal Workers For RSE

The current cap will be increased by 1,000 from 9,500 to 10,500 RSE workers for the 2016-17 season. Mr Woodhouse says the horticulture and viticulture industry is New Zealand’s fourth largest export industry, producing almost $5 billion in exports. More>>

ALSO:

Hurunui: Crown Irrigation Invests Up To $3.4m In North Canterbury

Crown Irrigation Investments will invest up to $3.4m in the Hurunui Water Project, an irrigation scheme that will be capable of irrigating up to 21,000 hectares on the south side of the Hurunui River in North Canterbury. More>>

ALSO:

Not So Great:Butterfly Eradication Success

The invasive pest great white butterfly has been eradicated from New Zealand in a world-first achievement, Primary Industries Minister Nathan Guy and Conservation Minister Maggie Barry say. More>>

Gordon Campbell: On The Government’s Tax Cuts Fixation

Long before the earthquake hit, the dodginess of the government tax cuts programnme was evident in the language of its packaging. It is being touted as a “tax cuts and family care” package... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news