May 30, 2013

Müller Wiseman introduces new contract, farm gate milk price formula

Müller Wiseman Milk Group members are presented with new contracts that include an option to link their milk price to movements in the value of global dairy commodities.

The 'Müller Wiseman Formula Price' option for dairy farmers is contained within the revised contract, which has been sent to all Müller Wiseman Milk Group members as part of the company's commitment to the Voluntary Code of Practice.

Developed collaboratively by dairy farmers and the company as part of the Müller Wisemilk Initiative, the Müller Wiseman Formula Price will initially be available for nine months from July 1, 2013, for a maximum of 110 million litres

The formula will calculate a farm gate milk price using publicly available benchmarks: Actual Milk Price Equivalent (AMPE), Milk for Cheese Value Equivalent (MCVE) and a basket of competitor milk prices, all of which will be reviewed quarterly.

Dairy farmers who are currently being paid the company's standard milk price will be able to apply to sell a minimum of 10% of their milk volume (based on previous year's figures) under this new formula option.

Müller Wiseman Dairies is looking to declare the opening formula price within the next few days with a view to canvassing interest among farmers in June for commencement on July 1.