Fonterra Co-operative Group Ltd raised the midpoint of the 2024/25 season forecast Farmgate Milk Price by 50 cents to NZD 10.00 per kgMS.
The new forecast range of NZD 9.50 to NZD 10.50 per kgMS reflected the global market's ongoing strength.
“We’re committed to providing farmers the highest sustainable milk price, so I'm pleased to announce another lift in the forecast for the season,” said Fonterra CEO Miles Hurrell.
“We’re seeing a recovery of demand in Greater China as domestic milk production rebalances and demand from Southeast Asia continues to be strong.”
Looking at supply, milk production in the US and Europe has continued to be impacted by local factors, while production in most regions of New Zealand has increased.
“We’re continuing to monitor factors that may influence global supply and demand dynamics, including any potential impact from heightened geopolitical uncertainty.”
Fonterra’s forecast earnings for FY25 remain unchanged at 40 to 60 cents per share.
This forecast earnings range reflected an expectation that Fonterra’s underlying operating profit would be stable as it offsets the higher cost of milk in the second half of the financial year through improved sales volumes, product mix, and pricing.
It also reflected the change in Fonterra’s tax status, which will become effective from this financial year and reduce its reported earnings per share.
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