Reuters logo
NZ's Fonterra cuts farmer payout forecast as prices tumble
July 29, 2014 / 4:36 AM / 3 years ago

NZ's Fonterra cuts farmer payout forecast as prices tumble

WELLINGTON, July 29 (Reuters) - New Zealand dairy giant Fonterra Ltd cut its forecast payout to its suppliers in the new season by 14 percent because of tumbling world prices and a high exchange rate.

The world’s largest dairy exporter, also New Zealand’s largest company, said on Tuesday it was reducing its 2014/15 payout price to NZ$6.00 ($5.12) a kilo of milk solids from an initial forecast of NZ$7.00 made in May.

Fonterra said it was expecting a dividend from its consumer operations of 20 to NZ cents.

It said a fall in dairy prices, down 34 percent in Fonterra’s global auctions since February, a fall in demand, and the high New Zealand dollar were behind the cut.

Fonterra paid out a record NZ$8.40 per kilo in the 2013/14 season on the back of surging demand from China, which drove prices higher.

$1 = 1.1727 New Zealand Dollars Reporting by Gyles Beckford; Editing by Stephen Coates

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below