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New Zealand’s Synlait slashes dairy price forecast amid COVID-19 uncertainty

28 May 2020

Synlait Milk cut its milk price forecast for the current season on 28 May as global commodity prices dip.

According to Reuters, Synlait Milk cited lower dairy prices alongside a global slump in commodity prices during the coronavirus crisis when it cut its milk price forecast.

The New Zealand-based dairy company said it now forecasts base milk price for the 2019-2020 season to be NZ$7.05 per kilogram of milk solids (kgMS), versus $7.25 kgMS earlier this year.

Synlait, which is part-owned by a2 Milk Company, set the opening forecast for the 2020-2021 season at an even weaker figure of NZ$6.00 kgMS.

"We don't yet have a clear view of COVID-19's economic impact, but we do know it will impact demand, resulting in our decision to release a conservative opening forecast for the 2020/2021 season," Chief Executive Officer Leon Clement said.

As of last week, global dairy prices have declined nearly 14 percent compared with the prices on 7 January.

The world's biggest dairy exporter Fonterra also announced a cut to farmgate prices last week for the 2020-21 season as demand falters during restrictions to contain the virus.

Read more about this story on Reuters.


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