Fonterra revises milk collection forecast

Fonterra's Director of Co-operative Affairs Mike Cronin. Photo / Supplied

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Dairy giant Fonterra has revised its Milk Collection forecast for the 2019/20 season.

Speaking to The Country Early Edition's Rowena Duncum, Fonterra's Director of Co-operative Affairs Mike Cronin said February's Global Dairy Update showed milk collection is down slightly on last year, reflecting recent flooding events and drought conditions.

As a result, the co-op has revised its forecast for the full 2019/20 season to 1515 million kg/MS "which is a little bit down from the actuals from last year."

The drought is also having an impact on recent Global Dairy Trade auction results, explained Cronin.

"If nothing else was happening, when you do get a bit of drought like that, you do expect to see a bit of lift in GDT prices."

However, counter-balancing any effect the drought might ordinarily have, is the COVID-19 outbreak.

"There's a little bit of market uncertainty and GDT prices have dipped over the last three auctions. Whole milk powder stayed the same [this week] and that went a little bit against stock market conditions around the world., so not a bad result in the circumstances."

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Meanwhile, with weather conditions still affecting farmers, the Kaiapara, Far North and Whangarei District Councils have once again acknowledged Fonterra's efforts in sending water up to Northland.

"It was really good to hear, especially for the team."

Cronin said Fonterra had been able to send out tankers filled with water, "deliver that and bring them back full of milk, so it's a win-win there."

"We're still on standby for more water deliveries, so it's nice that we were able to do that and nice for our farmers to see that being done as well."'

Also in today's interview: Cronin paid tribute to outgoing board Chair John Monaghan who yesterday announced he would retire at the end of his three-year term in November and talked about Fonterra's recent sale of the Dennington factory in Australia.