Northern Advocate
  • Northern Advocate home
  • Latest news
  • Business
  • Opinion
  • Lifestyle
  • Sport
  • Property
  • Video
  • Death notices
  • Classifieds

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • On The Up
  • Business
  • Opinion
  • Lifestyle
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
  • Sport
  • Property
    • All Property
    • Residential property listings

Locations

  • Far North
  • Kaitaia
  • Kaikohe
  • Bay of Islands
  • Whangārei
  • Kaipara
  • Mangawhai
  • Dargaville

Media

  • Video
  • Photo galleries
  • Today's Paper - E-Editions
  • Photo sales
  • Classifieds

Weather

  • Kaitaia
  • Whangārei
  • Dargaville

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • What the Actual
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Northern Advocate

Milk price puts farmers in 'make or break' crisis

By Imran Ali
Northern Advocate·
7 Aug, 2015 06:00 PM3 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

A savage cut in revised forecast milk payout of $3.85/kg of milk solids has piled more financial pressure on Northland farmers ahead of a looming dry spell, with it fast approaching "make or break" time for many.

Dairy giant Fonterra yesterday announced a reduction in the farmgate milk price forecast from $5.25 in May to $3.85, saying the fall was due to continued significant imbalance between weak demand and surplus supply.

It has prompted a call from a Northland farming leader for Fonterra to be more open about plummeting dairy prices.

Whole milk powder prices dropped by 10.3 per cent to $US1590 ($1785) a tonne at Wednesday morning's GlobalDairyTrade auction, fuelling fears payout to farmers for the 2015/16 season would drop to the low $4s, or to perhaps the high $3s - well below the estimated break even point of $5.70/kg.

Fonterra board chairman John Wilson said although the current prices were unsustainably low and had begun to impact production levels globally, Fonterra was confident prices would recover over the course of the season.

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.

But president of Farmers of New Zealand, Northlander Ian Walker, said Fonterra's board and senior management needed to be honest with their shareholders rather than painting a rosy picture of the global dairy market.

"The average production cost is about $5 and an average farm of say 300 cows producing 120,000kg of milk solids would be making a loss of $120,000 [on the forecast payout]," said the Kaitaia farmer.

He said over the past 10 years, Fonterra had been telling New Zealand dairy farmers the market for their milk products was good for the foreseeable future which prompted them to invest more in their farms.

Advertisement
Advertise with NZME.

"Suddenly our payout has more than halved. The governance and leadership of Fonterra should be adding value to the economy, to its shareholders and they've failed dismally," he said.

Federated Farmers Northland dairy chairman Ashley Cullen said the joys had already been taken out of farming.

"After the last auction on Wednesday, the writing was on the wall for quite a savage cut. Before that, $4.25 I thought was quite hopeful. Who's to know we haven't hit the bottom yet."

Mr Cullen said the next GlobalDairyTrade auction in a fortnight's time would "either make it or break it" for Northland dairy farmers.

Discover more

Banks go for broke while farms cope with debts

09 Aug 10:00 PM

Mistreatment of farm animals blamed on farmer stress

24 Aug 06:52 PM

"It's no use worrying about it because it's totally out of our control. We can only make the best out of a worst situation," he said.

Fonterra has also given share-backed farmers an opportunity to apply for financial support of an additional 50 cents per milk solid for production. The payment, interest free for two years, will be paid back when the farmgate milk price goes above $6.00/kgMS.

Save

    Share this article

Latest from Northern Advocate

Northern Advocate

'Trying to survive': Woman alleges years of daily sexual violence by 'sadistic' ex

09 May 07:00 AM
Northern Advocate

$10k compensation awarded after rosters changed to separate couple

09 May 03:08 AM
Northern Advocate

Stunning art on show at Whangārei's Sculpture Northland this weekend

09 May 01:27 AM

One tiny baby’s fight to survive

sponsored
Advertisement
Advertise with NZME.

Latest from Northern Advocate

'Trying to survive': Woman alleges years of daily sexual violence by 'sadistic' ex

'Trying to survive': Woman alleges years of daily sexual violence by 'sadistic' ex

09 May 07:00 AM

The man is defending physical and sexual violence allegations made by five exes.

$10k compensation awarded after rosters changed to separate couple

$10k compensation awarded after rosters changed to separate couple

09 May 03:08 AM
Stunning art on show at Whangārei's Sculpture Northland this weekend

Stunning art on show at Whangārei's Sculpture Northland this weekend

09 May 01:27 AM
Northland ovarian cancer patient pens song to help raise awareness

Northland ovarian cancer patient pens song to help raise awareness

09 May 12:00 AM
Connected workers are safer workers 
sponsored

Connected workers are safer workers 

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • The Northern Advocate e-edition
  • Manage your print subscription
  • Manage your digital subscription
  • Subscribe to Herald Premium
  • Subscribe to the Northern Advocate
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The Northern Advocate
  • The New Zealand Herald
  • The Northland Age
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • What the Actual
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven CarGuide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • © Copyright 2025 NZME Publishing Limited
TOP