Synlait Sets Opening Base Milk Price at $8/kgMS for Upcoming Season
Source: The DairyNews
Synlait, a prominent milk processor listed on the stock exchange, has announced an opening forecast base milk price of $8 per kilogram of milk solids (kgMS) for the upcoming season. Operating milk plants in Canterbury and Waikato, Synlait has adopted a conservative forecasting approach due to the inherent volatility of global dairy commodity prices at the start of the season.
Despite the uncertainties, the company has maintained its forecast for the 2023-24 base milk price at $7.80/kgMS. Over the past two seasons, Synlait's farmer suppliers have benefitted from an average incentive of $0.28/kgMS above the base price, and the company anticipates continuing to offer similar incentives in the coming two seasons.
"Forecasts are based on the best information available at the time," stated a Synlait spokesperson. "We will continue to monitor the market closely and upd ate our farmer suppliers as necessary."
The final milk price for the 2023-24 season will be confirmed with the release of the company's full-year results in September, at which time the forecast for the 2024-25 season will also be updated.
This announcement follows a similar update from Fonterra earlier in the week, which se t its opening forecast range at $7.25 to $8.75/kgMS, with a midpoint of $8/kgMS. Fonterra noted that milk supply and demand dynamics are finely balanced and that China's import volumes have not yet returned to historical levels.
"Given the early point in the season, the uncertainty in the outlook, and ongoing risk of volatility in global markets, we are starting the season with a cautious approach," Fonterra explained.
"Forecasts are based on the best information available at the time," stated a Synlait spokesperson. "We will continue to monitor the market closely and upd ate our farmer suppliers as necessary."
The final milk price for the 2023-24 season will be confirmed with the release of the company's full-year results in September, at which time the forecast for the 2024-25 season will also be updated.
This announcement follows a similar update from Fonterra earlier in the week, which se t its opening forecast range at $7.25 to $8.75/kgMS, with a midpoint of $8/kgMS. Fonterra noted that milk supply and demand dynamics are finely balanced and that China's import volumes have not yet returned to historical levels.
"Given the early point in the season, the uncertainty in the outlook, and ongoing risk of volatility in global markets, we are starting the season with a cautious approach," Fonterra explained.
