MG delivers boost to opening price

Murray Goulburn suppliers have received a 50 cents per kilogram milk solids boost on the original opening price announced by the processor three weeks ago.

MG was the first to announce opening 2017/18 prices, with a conservative $4.70 per kilogram milk solids.

But the processor last week announced a revised opening price of $5.20/kg milk solids, which was welcomed by the United Dairyfarmers of Victoria.

The revised opening price includes the reward program and other incentive payments.

MG said the previous opening price announcement on June 6 was earlier than previous years to assist suppliers with budgeting and business planning.

The updated price has taken into account improved commodity prices reflecting anticipated market returns, together with additional contracted sales.

“MG recognises that in the current competitive environment it needs to maintain milk supply and provide improved cash flow for suppliers. “The decision to revise the opening price to $5.20/kg MS is intended to assist in maintaining competitiveness and support the supplier base,” suppliers were told.

UDV president Adam Jenkins said MG had made a sensible decision to step up their milk price after listening to its supplier base.

“They’ve taken a positive step forward, but many farmers across Victoria are still recovering from last season’s milk price cuts,” he said.

The UDV has urged processors to pass any upward movements in the milk market onto farmers, with many farm businesses expected to remain challenged into the new season.

“We’re encouraging farmers to do their own numbers on their own farms with their own system and processors.

“By doing this, farmers will get a clearer picture of their true milk price, rather than the weighted average price announced by the processors,” Mr Jenkins said.