Fonterra Reports Strong Q3 Performance and Announces 2026/27 Milk Price
Fonterra Co-operative Group has announced a robust financial performance for the third quarter of the fiscal year, with a total group operating profit of NZ $1.8 billion. This figure represents an increase of NZ $103 million compared to the same period last year. The company's underlying earnings per share rose to 57 cents, up from 53 cents.
Financial Forecasts and Milk Price
The Co-operative has adjusted its full-year forecast earnings range to 60-70 cents per share, improved from the previous range of 50-65 cents. The 2025/26 season forecast for the Farmgate Milk Price has narrowed to a range of NZ $9.60-$9.80 per kgMS, maintaining a midpoint of NZ $9.70. Fonterra has also set an opening forecast for the 2026/27 season with a Farmgate Milk Price of NZ $9.75, within a range of NZ $8.00-$11.00 per kgMS.
Milk Collections and Strategic Moves
Season-to-date milk collections have reached 1,489 million kgMS, marking a 4% increase from the previous season. Despite global supply chain disruptions, Fonterra has managed to maintain strong shipping volumes, achieving the highest third-quarter shipment levels in a decade.
CEO Richard Allen highlighted the company's commitment to its strategic goals, citing the completion of the Mainland Group sale, which returned NZ $3.2 billion to shareholders and unit holders. Fonterra is focusing on expanding its high-value Ingredients and Foodservice businesses, with significant investments in capacity and product validation stages across several facilities.
Organic Business Expansion
Fonterra has announced plans to expand its organic business into the South Island, responding to growing interest from farmers. The current season's Organic Milk Price range is forecasted at NZ $13.90 - $14.10 per kgMS, with a midpoint of NZ $14.00. The opening forecast for the 2026/27 season stands between NZ $13.00 and $15.00 per kgMS, also with a midpoint of NZ $14.00.
Market Outlook
Looking forward, Fonterra remains confident in its strategic direction, despite acknowledging uncertainties from geopolitical risks and inflationary pressures. The company anticipates continued solid demand across regions, supported by strong relationships with customers and logistics partners.
