Australian dairy opening prices 2025: Rolling coverage of Bega, Fonterra, Saputo, Lactalis prices

Kiwi farmers are on track to get a better price than their Aussie counterparts. See our rolling coverage for the latest on dairy prices for next season.

Fonterra is offering its New Zealand suppliers an opening price of $NZ10 ($A9.28) per kilo milk solids next season, outraging Australian farmers who say the processor is deflating the Australian farmgate.

Management at the Auckland-based processor confirmed the $NZ10 offering on Thursday, four days after it provided a southern Australian average of $A8.60 per kilo milk solids.

Fonterra is the only Australian processor to provide an opening price so far, with the mandatory dairy code of conduct deadline set for 2pm on June 2.

eastAUSmilk president Joe Bradley said the trans-Tasman pricing disparity was outrageous and accused Fonterra of artificially deflating Australian farmgate competition.

“Farmers are white-hot with anger when it comes to the processors, and Fonterra specifically,” the Brisbane region farmer said.

“It’s bloody outrageous. First, you have Fonterra putting out a price in Australia that is no-where near reflective of input costs or market fundamentals at $8.60. Then you have them providing a price in New Zealand that’s about 70 cents higher (per kilo milk solids) than what they’re offering in Australia.”

President of eastAUSmilk, Joe Bradley.

Mr Bradley said Fonterra’s actions this week necessitated reforms to the mandatory dairy code of conduct, implemented in July 2020 by the Morrison Government.

“The processors have found a way of getting around the mandatory code and it’s undercutting farmers as a result. If the case for reform wasn’t clear before this week, it’s as clear as day now,” he said.

In a statement aimed at a New Zealand audience, Fonterra chief executive Miles Hurrell confirmed the NZ average price for the current season would also clock in at $NZ10 per kilo milk solids.

He said the $NZ10 figure equated to an approximate $NZ15 billion cash injection into the New Zealand economy.

“Looking at the season ahead, we expect this demand to continue for now, but we acknowledge the ongoing geopolitical uncertainty and the potential for a wider series of outcomes across the season,” Mr Hurrell said.

WEDNESDAY

Processors could still open at $9 per kilo milk solids or higher, Rabobank analyst Michael Harvey says, with only one processor outlining its opening price so far.

Fonterra released an average $8.60 per kilo milk solids on Monday, underwhelming farmers who claim the figure is a ‘low ball strategy’ to soften competition ahead of the June 2 pricing deadline.

Releasing Rabobank’s dairy outlook report on Wednesday, Mr Harvey said commodity prices and export returns for bulky dairy ingredients had rallied ahead of the new season.

He told The Weekly Times that domestic conditions were also improving, despite deflationary pressure on the dairy refrigerator cabinet.

“There’s still water to flow under the bridge before June 2, so $9 (per kilo milk solids) is still a live option,” Mr Harvey said.

“It may be a bullish prediction, but as we say in the report, the market dynamics for Australian dairy appear reasonably sound.

“As of this month, the cheese and whey value stream is 23 per cent higher than it was in June 2024 when the current season’s prices were being set, and the skim milk powder/butter value stream is up six per cent over the same period of time.”

Rabobank dairy analyst Michael Harvey

Ahead of the 2023-24 season, processors engaged in a months-long bidding war for milk supply, pushing the price past $9 per kilo milk solids to break through the $10 barrier in some markets. The opposite was the case ahead of 2024-25 deadline day, with most processors waiting until the mandated deadline to report their opening prices.

“We may see some movement later in the week. There are positives in May 2025 that weren’t there in May 2024 — we have a weaker Australian dollar and stronger international dairy demand,” Mr Harvey said.

MONDAY

Farm lobby leaders have slammed Fonterra’s opening bid for milk, claiming their $8.60 per kilogram milk solids offer is part of a financial strategy.

One week out from deadline day for processors to reveal their opening milk prices for next season, Fonterra Oceania managing director David Breckenridge confirmed the figure for 2025-26, lower than the mid $9 per kilo milk solids range that farm lobby leaders were calling for.

“Our opening price is higher than the current season, reflecting improved global market conditions, although dampened by a continued soft domestic outlook,” Mr Breckenridge said.

“Geopolitical tensions and potential trade disruptions, along with currency volatility continue to create uncertainty for the longer-term outlook.”

United Dairyfarmers of Victoria president Bernie Free said the $8.60 per kilo figure “was not a serious price” and part of Fonterra’s strategy at providing a low-ball figure.

“This is all part of a game by Fonterra and the other processors will join in,” he said.

“At a time when farmers are being hit with drought, the best you could describe $8.60 is a bloody joke.

“You’d have to say this is all part of a game where they offer $8.60, hope the other processors offer a low figure too, and they weigh down the price. It’s a disgrace.”