News Milk supply
Seasonal peak milk in New Zealand considerably lower
The seasonal peak of milk supply in New Zealand has been considerably lower compared to last year. In contrast to the Netherlands, the high milk price in New Zealand does not lead to an increase in the milk pool.
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New Zealand dairy farmers produced 3.025 million tonnes of milk in October. This is a decrease of about 3,5% compared to the same month last year. The contraction is in line with the previous months, despite the record high milk prices, which on paper should lead to extra production. In addition, the weather conditions are relatively mild this year, compared to previous years when heavy rainfall and drought alternated.
It is no surprise that the seasonal peak this year is considerably lower than in previous years. Milk production in New Zealand is under pressure due to increasingly strict environmental legislation in dairy farming. Furthermore, further contraction is lurking.
Fonterra
The government recently expressed the ambition to have a CO2050-neutral economy by 2. Calculations show that the dairy herd must be reduced by 15%. Thus it is Fonterra plans to adjust the capital structure, making it easier for dairy farmers to become members.