AUSTRALIA’S largest farmer co-operative has stepped up to re-build confidence in the dairy industry by announcing a record opening milk price.Victoria’s Murray Goulburn co-operative announced a record $5.60/kg opening season milk price this week.
“It’s going to give dairy farmers a good strong start to next season (2013-14),†United Dairyfarmers of Victoria president Kerry Callow said.
“We’ve had a tough season, but this opening price sends a strong signal right through the industry – dairy farmers, the banks and politicians – that dairy has and always will have a pivotal role in the state’s economy.
“Now MG has set the benchmark, we want to see other major dairy factories step up and deliver.
“MG’s directors and management have recognised the need to deliver much needed cash, which will give farmers the confidence to retain their core herd in preparation for spring.
“Obviously we need to see how MG’s opening price fits within their new milk pricing system. We also have to recognise the opening price of $5.60 includes a 13 cent loyalty payment.
In a circular sent to dairy faremrs this week MG stated the: “opening price reflects the positive impacts of the identified $100 million operational savings, higher world dairy ingredients prices and a softening Australian dollarâ€.
The co-operative company also forecast a full-year price of $5.80 to $6.00 per kilogram milk solids. This forecast represents the second highest milk price on record.
MG also confirmed the details of the implementation of the recent milk payment review, whereby about $35 million has been brought forward to the peak months of the season to bring farmgate pricing in line with product mix returns.
This improves cash flow for most MG suppliers and lifts Flat Milk Incentive (FMI) suppliers to a common base price.
Source: The Dairy Site
