[6 June/NZ Herald]

Fonterra is positioned to become the key milk price-setter in Australia after Murray Goulburn set its opening milk price for this season below the range indicated by Fonterra. Murray Goulburn set its opening farmgate milk price for 2017/18 at AUD4.70 per kg of milk solids, down from AUD4.95 per kg set for 2016/17, and expects the milk price to improve to between AUD5.20 and AUD5.40 per kg as the year continues. Fonterra Australia’s range is AUD5.30 to AUD5.70/kg. ASB Rural Economist Nathan Penny said Fonterra could become the benchmark price-setter in Australia in the long run. His prediction is attributable to the differences in the way the two co-operatives set their milk pricing and the fact that Murray Goulburn’s milk price is quite a bit lower than Fonterra’s.