By PHILIPPA STEVENSON
Tatua dairy company expects again to better Fonterra's payout to shareholders by $1.50 a kilogram of milksolids this year.
Last year, the small Waikato company paid its 132 shareholders $6.80 a kg compared with $5.30 the Fonterra mega co-op paid its 13,000 farmers.
In a letter to shareholders this week,
Tatua said its best estimate for payout in the season ending in May was $5.10 a kg, or $1.50 above Fonterra's forecast $3.60 a kg.
That would make the average Tatua farmer around $118,000 better off than his Fonterra neighbour for the year. Tatua, which specialises in high-tech, high-returning nutritional products extracted from milk, advised its farmers to budget conservatively on receiving $5 a kg.
That advice is likely to be driven by doubts commodity prices will generate expected returns which could signal more bad news for Fonterra farmers. Their forecast payout has been cut three times and they could be in line for another 10c reduction to $3.50 a kg.
