Call for answers on price drop

Dairy industry representative Adam Jenkins is questioning why Murray Goulburn has revised its closing milk price when the industry is “showing signs of recovery”. Also pictured, right, Gerangamete farmer Shelley Scott.

Dairy industry representative Adam Jenkins is questioning why Murray Goulburn has revised its closing milk price when the industry is “showing signs of recovery”.

The United Dairyfarmers of Victoria president said the revised figure of $4.70 from $4.88 a kilogram of milk solids, needed clarification because the rest of the industry was showing signs of recovery “and other global market returns are moving in the opposite direction”.

Mr Jenkins said Fonterra New Zealand had raised its 2016-17 forecast farm-gate milk-price by 50 cents to $5.25 a kilogram of milk solids.

Murray Goulburn chief executive officer David Mallinson told suppliers last week that the co-operative would suspend its Milk Supply Support package from October 1 until June 30, 2017.

The milk processor introduced the Milk Supply Support Package to help farmers through the retrospective farm-gate milk-price cuts Murray Goulburn announced in April this year.

In Mr Mallinson’s letter to suppliers, he said the cooperative was forecasting a decrease their end of season farm-gate milk-price from $4.88 a kilogram of milk solids to $4.70 a kilogram of milk solids “due to unexpected wet conditions”.

Murray Goulburn supplier and Gerangamete farmer Shelley Scott said the additional $0.14 would improve cash flow, but the decreased end of season forecast would “cancel out” the increased milk price.

“It basically cancels itself out in the long run,” Ms Scott said.

“Given the tough winter I’ve had it will be handy to have the extra $0.14 now to put towards harvest, but overall it won’t make a lot of difference.”

For the full story see today’s Colac Herald.

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