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

 


Westland Milk Products announces 2014-15 pay-out prediction

Westland Milk Products announces 2014-15 pay-out prediction


New Zealand’s second largest dairy co-operative Westland Milk Products has announced a pay-out prediction of $6 to $6.40 per kilogram of milk solids (kgMS) before retentions for the 2014-15 season just commenced.

The company has also kept its pay-out prediction for the 2013-14 season at $7.50 - $7.70 per kgMS before retentions.

Chief Executive Rod Quin says Westland’s predicted pay-out is in line with the predictions by other New Zealand companies, all of which are experiencing the same international market conditions.

“The decline in pay-out for 2014-15 is due to lower international dairy prices and the relatively high New Zealand dollar,” Quin says. “The market has continued to decline as customers limit their purchases due to higher inventories in their supply chains, and growth in milk and dairy product supply from Europe and the USA.

“What we have to consider is whether we are at the bottom of the price cycle, and here the signs are slightly more encouraging. There are indications that customers are buying more than prior months to refill their supply chains.”

Quin says that some industry commentators have speculated that the weakening New Zealand dollar might off-set the impact of lowered dairy prices and therefore benefit pay-outs, but he cautions that, to date, the decline in the dollar has been very small and the currency remains over valued.

“Westland’s response to this situation is to continue its strategy to grow its capacity to produce higher value nutritional products such as infant formula,” Quin says. “Our traditional reliance on bulk dairy commodities makes us more vulnerable to the cyclical swings of the international dairy market. Our recently announced investment in a $102 million nutritionals dryer at Hokitika will give us the capacity to shift more of our production to this end of the
market where profits are higher and opportunities to lift pay-outs are better.”

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Housing: Affordability Drops 14%, Driven By Auckland Prices

Housing affordability across New Zealand fell 14 percent in the year ending November 2014, with Auckland’s lack of affordability set to reach levels it hit during the height of the global financial crisis, according to the latest Massey University Home Affordability Report More>>

ALSO:

The Dry: Fonterra Drops Forecast Milk Volumes By 3.3 Percent

Fonterra Cooperative Group, the worlds largest dairy exporter, reduced its milk volume forecast for the 2014-2015 season by 3.3 per cent due to the impact of dry weather on production in recent weeks. More>>

ALSO:

Strike: Lyttelton Port Workers Vote To Escalate Dispute

Members of the Rail and Maritime Transport Union (RMTU) at Lyttelton Port today voted to escalate their industrial action. Around 200 RMTU members have been operating an overtime ban since 17 December and today they endorsed a series of full withdrawals of labour at the port. More>>

ALSO:

Scoop Business: NZ Dollar Falls To 3-Year Low As Investors Favour Greenback

The New Zealand dollar fell to its lowest in more than three years as investors sold euro and bought US dollars, weakening other currencies against the greenback. More>>

ALSO:

Scoop Business: NZ Govt Operating Deficit Smaller Than Expected

The New Zealand’s government’s operating deficit was smaller than expected in the first five months of the financial year as a clampdown on expenditure managed to offset a shortfall in the tax-take from last month’s forecast. More>>

ALSO:

0.8 Percent Annually:
NZ Inflation Falls Below RBNZ's Target

New Zealand's annual pace of inflation slowed to below the Reserve Bank's target band in the final three months of the year, giving governor Graeme Wheeler more room to keep the benchmark interest rate lower for longer.More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news