Fonterra Australia has increased its 2019-20 average milk price to $6.80/kg of milk solids and also increased its 2018-19 average price.
‘‘We are increasing our farm gate milk price for the 2019-20 season by 20¢/kg MS, which brings our average farm gate milk price to $6.80/kg MS,’’ Fonterra Australia’s managing director René Dedoncker said.
‘‘You will have the option to take this step-up upfront rather than receiving it through the season,’’ Mr Dedoncker said.
The company is now in line with rival processor Saputo for the 2019-20 season.
Fonterra has also increased its average price for the 2018-19 season by 10¢ to $6.15/kg MS, also in line with Saputo.
‘‘(The step-up) will apply from July 1, 2018 to June 30, 2019 and be paid on July 15,’’ Mr Dedoncker said.
‘‘This 10¢ step-up will be paid to all suppliers who were supplying Fonterra on June 30 as well as suppliers who retired during the 2018-19 season.’’
Mr Dedoncker explained the reason for the price increase.
‘‘The outlook for the 2019-20 season is positive due to softening currency and we now have a better view of pricing on some of our new-season customer contracts since we announced our opening price in May.’’
However, Fonterra’s latest Global Dairy Update reveals milk collection across the country to May 31 fell for the 11th straight month.
Fonterra’s milk collection is down 19.8 per cent when compared to the same period last year, with May collections sitting at 8million kg MS, down 31.4 per cent on last May.
The figures are part of a state-wide trend.
Milk production in northern Victoria has fallen by more than 330million litres to the end of May when compared to last season, with May production falling by almost a fifth compared to last year.