Fonterra cuts opening prices for milk

Milk suppliers to Fonterra have been told over Christmas that they will lose a November-announced price increase this month.

Fonterra prices will revert to the opening prices announced in June 2008, following Murray Goulburn Co-operative's decision to reduce its opening price.

Fonterra blamed the move on falling commodity prices and weakening global economy.

In mid-November, Fonterra said it was increasing prices by 17/kg protein paid retrospectively to July 1.

Fonterra is currently reviewing its pricing levels for the February-June 2009 period, according to Fonterra Ingredients Australia managing director Bruce Donnison.