Fonterra announces record new season forecast for organic suppliers

Fonterra has announced a record midpoint forecast of $12.30/kg MS for its organic farmers, underpinned by a strong outlook in the organics sector. The forecast range spans $11.30-$13.30/kg MS, accounting for uncertainties in long-term projections, according to Fonterra group director farm source Anne Douglas.

The 2024-2025 season's forecast was adjusted to a range of $11.70-$12.30/kg MS with a midpoint of $12/kg MS, a rise from the previous forecast midpoint of $11.80/kg MS. This announcement follows a report of a 25% increase in Fonterra's sales forecast for the financial year 2025 compared to the prior year.

Douglas highlights strong customer demand and constrained supply in key regions like the United States as factors boosting Fonterra's organics business. Currently, Fonterra boasts over 100 organic suppliers, primarily in New Zealand's North Island, with a supply growth rate of 2-3% annually. "Overall, we’re seeing positive customer demand coupled with ongoing constrained supply, particularly across the United States," Douglas noted.