SOUTH Australia’s dairyfarmers are set for one of their most profitable seasons following some of the strongest opening prices on record.
South Australian Dairyfarmers Association president David Basham said it should be a good year to stabilise business models and add to the bottomlines of dairying properties.
“While it’s positive that prices have opened well, the concerning thing is that there’s no predictions of any significant step-ups in price during the year,” he said.
“Certainly opening prices are strong – they are some of the highest, if not the highest, that have been announced in recent years, but the prediction for closing prices is not as high.
“At this stage, it’s not looking like closing prices will be as strong as the year we’ve just had.”
Mr Basham said the opening prices announced should set farmers up for a profitable 12 months.
“It should help people stabilise their businesses. We need a few of those kinds of years, after the rough ones,” he said.
Parmalat will be paying its SA suppliers the highest fixed price of up to $6.51 a kilogram milk solids and its Vic suppliers $6.32/kgMS, while Lion suppliers could receive up to $6.40/kgMS.
Murray Goulburn has announced a record opening price for the 2014-15 dairy season of $6/kgMS for its southern milk pool – a 7%increase on the 2013-14 opening price. The forecast end-of-season milk price for 2014-15 is in the $6.15 to $6.30/kgMS range, which equates to about 47 cents a litre.
This forecast is subject to external factors, such as international dairy market prices and currency movements.
MG managing director Gary Helou said demand for dairy foods remained relatively strong in key markets in Asia and the Middle East.
“Strong demand in the world dairy ingredients market led to high prices during the year, but these have now softened,” he said.
Source: Australian Dairyfarmer