Fonterra announced an increase of 13 cents a kilo of milk solids for suppliers in Victoria and Tasmania for the 09/10 season on Friday.
The company’s national milk service’s manager Heather Stacy said:
“This increase means that from next week our more than 1,300 suppliers in Victoria and Tasmania will start to receive an additional $15 million in their pockets,” said Ms Stacy.
“We recognise it has been a tough season for dairy farmers. We have been monitoring market conditions closely in order to pass through an improvement in prices as soon as it is responsible to do so.
“In this week’s Fonterra globalDairyTrade, prices for whole milk powder rose for the fourth consecutive month, reinforcing the positive signs of recovery in commodity markets after a year of unprecedented volatility,” said Ms Stacy.
“This has meant we are now in a position to pass on an increase in milk prices to our suppliers.
“We remain determined to reflect any further significant improvement in market conditions in our price later this season. In this regard, the strength of the Australian dollar is a major limitation on the opportunity for farmers to benefit further from improved commodity prices,” said Ms Stacy.
Fonterra has said it will make an announcement about the season’s payout for New Zealand suppliers this week.
That happens if there is to be a change of more than 30 cents and it is a fair bet any change is likely to be positive.