Synlait Milk Limited has updated its forecast base milk price for the 2020/2021 season to $7.20 kgMS from $6.40 kgMS.
Synlait said its decision to increase its forecast base milk price was driven by the strong increase in dairy commodity prices over recent months
The decision was also influenced by the company's view that commodity prices would remain around current levels for the remainder of the milk season.
"Despite the wider global uncertainty, dairy commodity prices have remained robust, and a higher forecast base milk price will be welcomed by our Synlait farmer suppliers," Synlait's National Milk Supply Manager David Williams said.
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Forecasts were based on the best information available to Synlait at the time.
The company said it would continue to monitor movements and keep its farmer suppliers updated.
Synlait's next milk price announcement will occur in May 2021.
Westpac also recently lifted its 2020/21 farmgate milk price forecast by 50 cents to $7.50/kg - 20c above the upper end of Fonterra's forecast range.
Last month, Rabobank increased its forecast by 65 cents to $7.00 kg/MS for the 2020/21 season.
Since early November, overall dairy prices have jumped 17.2 per cent, in the Global Dairy Trade Auction, with more than half of the lift occurring since the start of the year.
Fonterra's farmgate milk price has exceeded $7.00/kg only four times in the co-op's 20-year history.