Fonterra To Introduce Tactical Milk Pricing

Fonterra To Introduce Tactical Milk Pricing

Fonterra plans to introduce tactical pricing on contract milk next season to help protect milk supply in parts of the country where it faces competition.

Chairman Henry van der Heyden said yesterday the move to offer higher spot pricing on contract milk to counter competitors had been discussed with Fonterra suppliers at the December round of farmer meetings.

“We advised that next season we had decided to implement a more flexible approach to enable higher spot pricing of contract milk only, as it was in the co-operative’s interests to ensure we could compete aggressively for supply in areas where we face competition,” he said, adding that the new pricing policy would be implemented for one year and then be subject to review.

“During the next 12 months farmers will see Fonterra implement tactical pricing in the Waikato and Canterbury and other areas where there are active competitors, but only if and when it will benefit the co-operative as a whole,” he said.

Mr van der Heyden said Fonterra had no plans to introduce different payouts to farmers in different regions.

ENDS

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