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HighGround: Farmgate price to be higher

HighGround: Farmgate price to be higher
In this week of limited USDA reports, dairy markets got a little food for thought from down under. HighGround Dairy’s Eric Meyer reported Fonterra announced an increase to its forecast farm gate milk price for the 2014 season, and the likely impact on earnings for the current financial year.
Chairman John Wilson said the cooperative announced it has increased its forecast for the 2014 season by 50¢ to $8.30 per kgMS. The increase, along with an estimated dividend of 32¢ per share, amounts to a forecast cash payout for 2014 of $8.62.
A Fonterra press release stated “The record forecast farm gate milk price reflected continuing strong international prices for dairy, particularly whole milk powder driven by robust demand from Asia, especially China. We are still facing high levels of volatility around the world.”
But chief executive Theo Spierings warned that the business “also faces headwinds, especially in the first half of the current financial year when we expect earnings will be significantly lower than the strong performance in the first half of 2013.”
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