New Zealand’s Fonterra Co-operative Group said last week that it expected its fiscal 2024 earnings to be in the upper end of its forecast range of 60 to 70 NZ cents per share, adding that the dairy company was on track to pay a strong dividend for the year.
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A significant increase in the prices of dairy products and a spectacular increase in sales volume
Improvement in the global milk market
The dairy company also raised its producer milk price forecast for the 2024-2025 season, citing an increase in global dairy prices and an improvement in the company's balance sheet.
Fonterra said it now forecasts the price paid to farmers for milk to be between NZ$7.75 and NZ$9.25 per kilogram of milk solids (kgMS), from a previous range of NZ$7.25 to NZ$8.75 per kgMS, representing an increase of 50 NZ$ cents above the target average level.
“The changes announced today will result in farmers receiving 10 per cent more in the forecast farm gate milk price for the 2025 fiscal year from December to January compared to other seasons, helping farmers to maintain cash flow on farm,” said Miles Hurrell, CEO of Fonterra.
Fonterra is scheduled to report its fiscal 2024 results on September 25.
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The decline in milk prices in the country is clearly slowing down
