Westland Milk hikes forecast payout range by $1, following Fonterra increase
Westland Milk, the Hokitika-based dairy cooperative, has followed Fonterra Cooperative Group's lead in hiking its forecast payout to farmers on strong milk flows and elevated international prices.
The company expects to pay between $7.60 and $8 per kilogram of milksolids before retentions for the 2013/14 season, up from a forecast range of between $6.60 and $7, and hiked its advance rate 20 cents to $5 per kgms, it said in a statement. The increase comes a day after dominant player Fonterra raised its forecast 30 cents to $7.80 per kgms as global demand continues to keep international prices high.
The increase was due to strong international prices and as Westland's milk flows were up 5 percent with the mild winter leaving cows in good condition and with plenty of grass.
"Current market conditions, plus Westland's strategic move to the higher value nutritionals market is driving this confident payout forecast," chief executive Rod Quin said. "We've had a very successful launch of our new Westpro nutritional products in China recently, and fully expect the new nutritional products plant in Hokitika to be working to capacity this season."
Earlier this month Westland had the export certificates for four consignments of lactoferrin it had produced revoked after unacceptable levels of nitrates were found in two batches.
That discovery came as New Zealand's dairy products come under greater scrutiny amid a food scare over bacteria discovered in whey protein produced by Fonterra, which has today been cleared as a false alarm.