Fonterra's sharply higher milk price forecast for 2013/14 will not translate into higher prices for the consumer, chief executive Theo Spierings said today.
The farmer's cooperative forecast a $7.00 per kg of milksolids milk price for the upcoming 2013/14 season, up from a forecast $5.80 per kg for the current 2012/13 season, which ends on May 31.
Spierings said higher prices on world commodities markets would not translate into higher milk prices for consumers.
Fonterra last year conducted research on the affordability of milk and concluded that its product price increases would be in line with food price inflation.
"We are not going to price our products based on highly volatile commodities markets,'' Spierings told APNZ.
He said the higher milk price would put pressure on Fonterra's profit margins for its branded products.