Tatua’s big $7.60/kg payout

Soaring international milkfat prices have helped the Tatua Cooperative Dairy Company post a ‘‘solid’’ 2016-17 financial result and a payout of $7.60 a kilogram of milksolids.

The small co-operative from Waikato settled on a cash payout to shareholders of $7.10/kg once 50c/kg was removed as a pre-tax retention for reinvestment.

The payout was confirmed by its board last week along with an operating revenue of $335 million and earnings of $114m for the season.

Chief executive Brendhan Greaney described it as a ‘‘solid’’ result for the co-operative.

‘‘We’re reasonably happy with it.’’

The bulk ingredients side of its business, which includes caseinate, whey protein concentrate (WPC) and anhydrous milk fat (AMF) had performed well on the back of record high fat prices.

‘‘Our bulk ingredient mix has been particularly profitable this season on the back of AMF.’’

Prices have moved from US$3800 per tonne at the beginning of last season to US$7000. AMF prices sit at US$6764 following the latest GlobalDairyTrade auction.

Its value add business had also performed well with returns being more stable. He was also happy with the performance of Tatua’s three subsidiaries in China, Japan and the United States.

Tatua’s result is up on the 2015-16 year, when it generated $289.3m in revenue and earnings before payout, taxation and retentions of $99.8 million, which equated to $6.41/kg and a final cash payout of $6.30/kg.

Last season, Tatua processed 15 million kilograms of milk solids from 113 suppliers. This season, the company has 110 shareholdersuppliers.