NZ farmers see milk price forecast fall to 12ppl

Published 11 August 15

Fonterra has reduced its 2015/16 forecast farmgate milk price by more than a quarter, taking it to around 12ppl ($3.85 per kilogram of milk solids). This is due to the ongoing imbalance in the global dairy markets.

Fonterra predicts lower prices will lead to a slowdown in its milk supply, with 2015/16 production (June-May) forecast to finish around 2% below last season. An increasing number of farmers are expected to reduce stocking rates and supplementary feeding to support margins, according to the processor.

A slowdown in NZ milk production could help to ease some of the pressure on prices, depending on global supply levels and demand developments.

NZ graph 12Aug15