As the new milk year loomed processors were keen to raise the stakes.
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Saputo and Fonterra increased their milk prices to $9.10/kg MS, while Bulla jumped to $9.50-$9.80/kg MS, in the weeks leading up to the new milk season. Photo by Cath Grey

On June 21, Saputo increased its opening weighted average milk price to $9.10/kg of milk solids and then again to $9.40 on June 29.

Fonterra increased its 2022-23 average milk price to $9.10/kg MS on June 22 and then late at night, on June 23, Bulla Dairy Foods stepped up again — ensuring the majority of its suppliers will now receive between $9.50 and $9.80/kg MS.

Northern Victorian dairy farmers were pleased with the higher prices.

Yarroweyah dairy farmer Daryl Iskov said he couldn’t believe the milk prices.

“The milk price is great, I’ve never seen it so good in all my life — and I’m an old farmer,” Daryl said.

Gordon Emmett milks about 200 head at Stanhope and said the milk prices were good.

“It’s where it needs to be for the cost of the inputs,” Gordon said.

“I can see us making a profit. We supply ACM. We originally went for ACM because they had a good price and we switched over the year of the walk-backs, so it worked out for us.

“ACM guaranteed they’ll pay 10 cents more than Bega. But really, let’s face it, everyone is paying a good price this year.”

Bamawm farmer Mark Gardiner runs a 1000-cow dairy and supplies Noumi (formerly Freedom Foods).

“The milk price is fantastic. These are large enough increases that we’ll see a larger profit margin, even allowing for the cost of grain,” Mark said.

Wyuna East dairy farmer Julie Young also supplies Noumi.

“The price is going in the right direction,” she said.

Merrigum dairy farmers Jamie Walford and Sally Rowe recently started their own dairy and are milking about 80 head.

“Because input prices have gone up, it’s not like our profit margin has increased,” Sally said.

“We are with ACM. They came to use very early with a really good deal. We are happy sticking with them because they are easy to deal with and when you need something, they’re there.”

Fonterra Australia managing director Rene Dedoncker described Fonterra’s $9.10/kg MS offering as “pretty healthy”.

He said the competition at the moment was “pretty hardy”.

“What you’re seeing is demand exceeding supply and that always drives prices.

“As we perform, as time goes on, as we land contracts, we continually review our milk price … the last two years have demonstrated that if it is earned, it is shared.”

The 2022-23 milk season started on Friday, July 1.

With calving underway, dairy farmers are being urged to plan ahead to combat feed shortages.

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