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

 

Fonterra Australia to pay more in 2017/18 season

Fonterra Australia to pay more in 2017/18 season with improving business, milk price

By Rebecca Howard

May 10 (BusinessDesk) - Fonterra Cooperative Group says an improvement in its Australian business and rising milk prices mean it will be able to pay its suppliers more in the season that kicks off in six weeks.

Fonterra Australia expects to pay its Australian suppliers a range of A$5.30-to-A$5.70 per kilogram of milk solids in the 2017/18 season as well as an additional payment of 40 Australian cents/kgMS. It paid A$5.20/kgMS in the season that is just ending.

Managing director Rene Dedoncker said the forecast for the season is underpinned by the fact that the Australian business is in a stronger position, with the range based on current exchange rates and commodity market conditions.

"We've invested in world-class assets, improved our product mix, and exited non-strategic businesses. This coupled with the rebalancing of global supply gives us the ability to pay a competitive milk price to our farmers," said Dedoncker.

The additional 40 Australian cents came after Murray Goulburn's recent announcements including a decision to forgive its milk supply support package, Fonterra said. The package was introduced last year after Murray Goulburn cut the price for its suppliers. Under the system, the payments were higher than the reduced price but farmers had to repay the money from future milk payments.

Earlier this month Murray Goulburn announced all future payments of the package which were to recommence from July 2017 will cease and it will also make a payment to continuing and retired suppliers who made contributions between July and September 2016, and to any suppliers who recommence supplying milk to Murray Goulburn by July 31, 2017.

Fonterra said the additional payment will be available to all current, retired and recommencing suppliers.

"We believe this payment is the right thing to do and we're committed to ensuring our farmers are better off by partnering with us," Fonterra said.

Fonterra will also reimburse Australian 85 cents/kgMS interest change for the Fonterra Australia support loans package that was included in this season's milk price to all current suppliers.

The dual-listed units in the Fonterra Shareholders Fund rose 1.7 percent to $5.99 on the NZX, and were up 2.2 percent to A$5.65 on the ASX.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Back Again: Government Approves TPP11 Mandate

Trade Minister Todd McClay says New Zealand will be pushing for the minimal number of changes possible to the original TPP agreement, something that the remaining TPP11 countries have agreed on. More>>

ALSO:

By May 2018: Wider, Earlier Microbead Ban

The sale and manufacture of wash-off products containing plastic microbeads will be banned in New Zealand earlier than previously expected, Associate Environment Minister Scott Simpson announced today. More>>

ALSO:

Snail-ier Mail: NZ Post To Ditch FastPost

New Zealand Post customers will see a change to how they can send priority mail from 1 January 2018. The FastPost service will no longer be available from this date. More>>

ALSO:

Property Institute: English Backs Of Debt To Income Plan

Property Institute of New Zealand Chief Executive Ashley Church is applauding today’s decision, by Prime Minister Bill English, to take Debt-to-income ratios off the table as a tool available to the Reserve Bank. More>>

ALSO:

Divesting: NZ Super Fund Shifts Passive Equities To Low-Carbon

The NZ$35 billion NZ Super Fund’s NZ$14 billion global passive equity portfolio, 40% of the overall Fund, is now low-carbon, the Guardians of New Zealand Superannuation announced today. More>>

ALSO: