More prices rise above $9/kg milk solids in final week frenzy

ACM is the latest smaller player to increase their opening offer as the dairy farmgate ‘auction’ enters its final week.

Australian Consolidated Milk has boosted its offering to $9.15 per kilogram milk solids, its second step up this month.

With less than a week to go before the start of the new financial year, ACM previously raised its $8.85 per kilogram opening offer to $9 before a second 15c refresh.

ACM chief executive Jason Limbrick said the forecasted weighted average milk price excluded any multi-year sign-on payments.

“ACM remains committed to ensure a market competitive milk price for our suppliers and this revised opening weighted average milk price is recognition of that,” Mr Limbrick told suppliers in a letter on Thursday.

“We will continue to formally review our weighted average milk price on a quarterly basis throughout the season.”

Goulburn Valley Creamery has also boosted its offering in a drive for new suppliers, now headlining at $9.70 per kilogram milk solids.

The $9.70 figure applies to exclusive suppliers and is one of the leading figures ahead of the new financial year, with only a handful of processors including Bulla, pushing past the $9.50 per kilogram mark.

GVC chief executive Mancel Hickey said the processor was seeking an additional 140 million litres of milk. He said the GVC would source milk from across Victoria as well as the Riverina.

“The updated price reflects strong competition in farmgate pricing and the company’s growing need for additional supply to meet increasing customer demand,” Mr Hickey said.

The ACM and GVC moves come less than a week after Bulla raised its pricing to a $8.90-$9.50 range, boosted by a 20c ‘peak to trough’ payment which lifts the offering to $9.10-$9.70 per kilogram milk solids.

Bulla opened at $8.40-$9.20 per kilogram milk solids at the start of June, then provided a first revision to a range of $8.70-$9.50 per kilogram milk solids.

Last week, Frestine also provided a pricing boost of 12c to provide a refreshed average of $9 per kilo milk solids.

Only a few processors are yet to publicly confirm step ups before the start of the new financial year, including Bega, KyValley and Union Dairy Company.

Australian Dairy Farmers president Ben Bennett said while the step ups were moving in the right direction, only returns above $9.50 per kilogram milk solids reflected the true cost of production in a drought.

“We’re talking about astronomical fodder prices at the moment — the cost of production is sky high,” the southwest Victorian farmer said.

“When Fonterra offered their low ball $8.60 figure at the start (of June), it really depressed the competition that’s only starting to get a bit of traction now. This was all part of the game because they know if they started higher, the call for step ups would push them into a higher position by July 1. Farmers see through their games.”