Milk continues to move between dairy processors as farmers chase higher returns two months into the new season.

It is believed Fonterra has lost about 300 million litres, a claim the company neither confirmed or denied, while Saputo is understood to have lost 200 million litres.

This loss would be about 15 per cent of milk supply for Fonterra and about 7 per cent for Saputo, but it also comes as national milk production expectations are down due to weather conditions, feed costs and industry confidence.

Saputo declined to comment on its supply.

Fonterra general manager farm source Australia Matt Watt said the whole industry was seeing milk movement.

“We have had some losses, as well as gains — but our volumes are where we expected them to be when combined with seasonal growth,” he said.

“There will not be any material impact on our business or operations.”

Former Fonterra suppliers told The Weekly Times they switched processors because they did not receive the 40c a kilogram of milk solids premium promised for milk supplied last season.

Mr Watt did not address the question asked about the 40c/kg/MS.

Bega Cheese recently told The Weekly Times it was up 5-10 per cent this season.

Australian Consolidated Milk general manager Peter Jones said it had a net gain of 100 million litres of milk for this season and forecast an annual supply of more than 450 million litres.

This new milk has been picked up across the state, but ACM now has a stronger presence in Gippsland.

“It has been a tough period for all dairy farmers and it certainly is not over yet,” he said.

“The milk price is OK, but it is the other costs, such as water, grain and electricity that are placing immense pressure on all suppliers.”

United Dairyfarmers of Victoria president Adam Jenkins said farmers were considering things such as the spring farmgate milk price, ethics and trust when making decisions to move milk.

Meanwhile, Fonterra has made available interest free loans for irrigation water in northern Victoria.

“We are working with industry to implement a range of operational and financial assistance measures to support all of our farmers — in some cases, that has involved interest-free finance for a short period, Mr Watt said.”

Article sourced from https://www.weeklytimesnow.com.au