July 25, 2011

Fonterra's milk prices remain the same

Although butter and cheese prices will decline in August due to a fall in international commodity prices, Fonterra will not decrease the milk prices which it froze earlier this year.

Fonterra's GlobalDairyTrade fortnightly auctions have shown three successive price declinations in the most current auctions with the trade-weighted spot dairy price decreasing 13% since June and 20% off its March record.

Agricultural officials earlier this year informed the government that high milk prices will persist in future, with high local costs being boosted by foreign dairy prices.

Late last month, the Agriculture and Forestry, Economic Development and Treasury declared that they had begun a separate inquiry into milk prices. Fonterra also recently announced that it will reveal how it determines milk price and the fundamentals of milk price calculation, as well as print a booklet to show how milk price is being derived in September.